AIM:SMS

Stock Analysis Report

Smart Metering Systems

Executive Summary

Smart Metering Systems plc, through its subsidiaries, connects, owns, operates, and maintains metering systems and databases on behalf of energy companies in the United Kingdom.


Snowflake Analysis

Mediocre balance sheet with weak fundamentals.

Share Price & News

How has Smart Metering Systems's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SMS's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-4.7%

SMS

-1.9%

GB Electronic

-2.2%

GB Market


1 Year Return

18.5%

SMS

-10.0%

GB Electronic

-25.9%

GB Market

Return vs Industry: SMS exceeded the UK Electronic industry which returned -9% over the past year.

Return vs Market: SMS exceeded the UK Market which returned -25.2% over the past year.


Shareholder returns

SMSIndustryMarket
7 Day-4.7%-1.9%-2.2%
30 Day28.0%-13.4%-21.7%
90 Day13.9%-19.5%-29.6%
1 Year20.0%18.5%-8.6%-10.0%-22.2%-25.9%
3 Year10.4%7.3%25.1%19.3%-16.1%-26.6%
5 Year79.8%72.0%71.3%56.6%-4.6%-26.2%

Price Volatility Vs. Market

How volatile is Smart Metering Systems's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Smart Metering Systems undervalued compared to its fair value and its price relative to the market?

176.96x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SMS (£6.29) is trading above our estimate of fair value (£2.47)

Significantly Below Fair Value: SMS is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SMS is poor value based on its PE Ratio (177x) compared to the Electronic industry average (17.1x).

PE vs Market: SMS is poor value based on its PE Ratio (177x) compared to the UK market (12.4x).


Price to Earnings Growth Ratio

PEG Ratio: SMS's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: SMS is overvalued based on its PB Ratio (3.2x) compared to the GB Electronic industry average (1.7x).


Next Steps

Future Growth

How is Smart Metering Systems forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-4.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SMS's earnings are forecast to decline over the next 3 years (-4.1% per year).

Earnings vs Market: SMS's earnings are forecast to decline over the next 3 years (-4.1% per year).

High Growth Earnings: SMS's earnings are forecast to decline over the next 3 years.

Revenue vs Market: SMS's revenue (0.02% per year) is forecast to grow slower than the UK market (2.4% per year).

High Growth Revenue: SMS's revenue (0.02% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SMS's Return on Equity is forecast to be low in 3 years time (6.6%).


Next Steps

Past Performance

How has Smart Metering Systems performed over the past 5 years?

-21.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SMS has a large one-off loss of £11.3M impacting its December 31 2019 financial results.

Growing Profit Margin: SMS's current net profit margins (3.5%) are lower than last year (4.5%).


Past Earnings Growth Analysis

Earnings Trend: SMS's earnings have declined by -21.8% per year over the past 5 years.

Accelerating Growth: SMS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SMS had negative earnings growth (-10.5%) over the past year, making it difficult to compare to the Electronic industry average (6.9%).


Return on Equity

High ROE: SMS's Return on Equity (1.8%) is considered low.


Next Steps

Financial Health

How is Smart Metering Systems's financial position?


Financial Position Analysis

Short Term Liabilities: SMS's short term assets (£120.7M) exceed its short term liabilities (£49.5M).

Long Term Liabilities: SMS's short term assets (£120.7M) do not cover its long term liabilities (£284.3M).


Debt to Equity History and Analysis

Debt Level: SMS's debt to equity ratio (120.4%) is considered high.

Reducing Debt: SMS's debt to equity ratio has reduced from 179.1% to 120.4% over the past 5 years.

Debt Coverage: SMS's debt is not well covered by operating cash flow (15.7%).

Interest Coverage: SMS's interest payments on its debt are well covered by EBIT (3.1x coverage).


Balance Sheet

Inventory Level: SMS has a high level of physical assets or inventory.

Debt Coverage by Assets: SMS's debt is not covered by short term assets (assets are 0.4x debt).


Next Steps

Dividend

What is Smart Metering Systems's current dividend yield, its reliability and sustainability?

1.09%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: SMS's dividend (1.09%) isn’t notable compared to the bottom 25% of dividend payers in the UK market (2.68%).

High Dividend: SMS's dividend (1.09%) is low compared to the top 25% of dividend payers in the UK market (7.57%).


Stability and Growth of Payments

Stable Dividend: SMS is not paying a notable dividend for the UK market, therefore no need to check if payments are stable.

Growing Dividend: SMS is not paying a notable dividend for the UK market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: SMS is not paying a notable dividend for the UK market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SMS's dividend in 3 years as they are not forecast to pay a notable one for the UK market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.4yrs

Average management tenure


CEO

Alan Foy (52yo)

13.25s

Tenure

UK£663,381

Compensation

Mr. Alan Henry Foy has been the Chief Executive Officer at Smart Metering Systems Plc since 2007 and served as its Group Managing Director. Mr. Foy has responsibility for business distribution, client mana ...


CEO Compensation Analysis

Compensation vs Market: Alan's total compensation ($USD812.25K) is below average for companies of similar size in the UK market ($USD1.29M).

Compensation vs Earnings: Alan's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Alan Foy
CEO & Executive Director13.25yrsUK£663.38k5.17% £36.6m
David Thompson
CFO & Executive Director2.58yrsUK£411.14kno data
Timothy Mortlock
COO & Director0.58yrno datano data
Andy Ritchie
Head of Business Risk and Complianceno datano datano data
Craig McGinn
General Counsel & Group Company Secretaryno datano datano data
Stan Chaloner
Group Sales Director8.25yrsno datano data
Bill Turner
Managing Director of UK Data Managementno datano datano data
Claire Corrins
Head of Gas Businessno datano datano data
Rhys Wynne
Head of Electricity Businessno datano datano data

5.4yrs

Average Tenure

42yo

Average Age

Experienced Management: SMS's management team is seasoned and experienced (5.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Alan Foy
CEO & Executive Director13.25yrsUK£663.38k5.17% £36.6m
David Thompson
CFO & Executive Director2.58yrsUK£411.14kno data
Timothy Mortlock
COO & Director0.58yrno datano data
Miriam Greenwood
Senior Independent Non-Executive Director3.83yrsUK£45.00k0.018% £125.5k
Graeme Bissett
Independent Non-Executive Director3.83yrsUK£45.00kno data
Donald MacDiarmid
Non-Executive Chairman3.92yrsUK£90.00kno data
Ruth Leak
Independent Non-Executive Director0.92yrno datano data

3.8yrs

Average Tenure

52yo

Average Age

Experienced Board: SMS's board of directors are considered experienced (3.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: SMS insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Smart Metering Systems plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Smart Metering Systems plc
  • Ticker: SMS
  • Exchange: AIM
  • Founded: 1995
  • Industry: Electronic Equipment and Instruments
  • Sector: Tech
  • Market Cap: UK£708.542m
  • Shares outstanding: 112.65m
  • Website: https://www.sms-plc.com

Number of Employees


Location

  • Smart Metering Systems plc
  • 48 St. Vincent Street
  • 2nd Floor
  • Glasgow
  • Lanarkshire
  • G2 5TS
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SMSAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPJul 2011
SMCDB (Deutsche Boerse AG)YesOrdinary SharesDEEURJul 2011

Biography

Smart Metering Systems plc, through its subsidiaries, connects, owns, operates, and maintains metering systems and databases on behalf of energy companies in the United Kingdom. It operates through three segments: Asset Management, Asset Installation, and Energy Management. The company engages in the regulated management of gas meters, electric meters, and ADM devices. It also installs domestic, industrial, and commercial gas meters and electricity meters, as well as provides energy consultancy services. In addition, the company provides data management, meter installation, electricity and gas utility management, and electricity and gas meter rental services. The company was formerly known as UK Smart Metering Group Limited and changed its name to Smart Metering Systems plc in June 2011. Smart Metering Systems plc was founded in 1995 and is headquartered in Glasgow, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/03 21:49
End of Day Share Price2020/04/03 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.