LSE:TALK

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TalkTalk Telecom Group

Executive Summary

TalkTalk Telecom Group PLC provides fixed line, TV, and mobile telecommunications services for residential, retail, and business customers in the United Kingdom.


Snowflake Analysis

Reasonable growth potential and fair value.


Similar Companies

Share Price & News

How has TalkTalk Telecom Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

1.8%

TALK

2.3%

GB Telecom

2.0%

GB Market


1 Year Return

-22.3%

TALK

-35.8%

GB Telecom

-12.8%

GB Market

Return vs Industry: TALK exceeded the UK Telecom industry which returned -35.8% over the past year.

Return vs Market: TALK underperformed the UK Market which returned -12.8% over the past year.


Shareholder returns

TALKIndustryMarket
7 Day1.8%2.3%2.0%
30 Day9.7%4.7%5.7%
90 Day-17.5%-12.0%-8.2%
1 Year-20.5%-22.3%-31.0%-35.8%-8.6%-12.8%
3 Year-42.4%-47.2%-48.8%-57.6%-6.2%-17.6%
5 Year-71.1%-76.8%-62.6%-71.1%12.7%-12.5%

Price Volatility Vs. Market

How volatile is TalkTalk Telecom Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is TalkTalk Telecom Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TALK (£0.91) is trading below our estimate of fair value (£2.68)

Significantly Below Fair Value: TALK is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TALK is good value based on its PE Ratio (28.8x) compared to the Telecom industry average (31.2x).

PE vs Market: TALK is poor value based on its PE Ratio (28.8x) compared to the UK market (14.6x).


Price to Earnings Growth Ratio

PEG Ratio: TALK is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: TALK is overvalued based on its PB Ratio (3.9x) compared to the GB Telecom industry average (2.7x).


Next Steps

Future Growth

How is TalkTalk Telecom Group forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

21.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TALK's forecast earnings growth (21.4% per year) is above the savings rate (1.2%).

Earnings vs Market: TALK's earnings (21.4% per year) are forecast to grow faster than the UK market (20.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TALK's revenue (0.6% per year) is forecast to grow slower than the UK market (3.6% per year).

High Growth Revenue: TALK's revenue (0.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TALK's Return on Equity is forecast to be high in 3 years time (23%)


Next Steps

Past Performance

How has TalkTalk Telecom Group performed over the past 5 years?

-34.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TALK has a large one-off loss of £53.0M impacting its September 30 2019 financial results.

Growing Profit Margin: TALK became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: TALK's earnings have declined by -34.3% per year over the past 5 years.

Accelerating Growth: TALK has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: TALK has become profitable in the last year, making it difficult to compare its past year earnings growth to the Telecom industry (9.8%).


Return on Equity

High ROE: TALK's Return on Equity (13.7%) is considered low.


Next Steps

Financial Health

How is TalkTalk Telecom Group's financial position?


Financial Position Analysis

Short Term Liabilities: TALK's short term assets (£289.0M) do not cover its short term liabilities (£550.0M).

Long Term Liabilities: TALK's short term assets (£289.0M) do not cover its long term liabilities (£992.0M).


Debt to Equity History and Analysis

Debt Level: TALK's debt to equity ratio (318.3%) is considered high.

Reducing Debt: TALK's debt to equity ratio has increased from 200.8% to 318.3% over the past 5 years.

Debt Coverage: TALK's debt is not well covered by operating cash flow (17.1%).

Interest Coverage: TALK's interest payments on its debt are not well covered by EBIT (2.4x coverage).


Balance Sheet


Next Steps

Dividend

What is TalkTalk Telecom Group's current dividend yield, its reliability and sustainability?

2.76%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TALK's dividend (2.76%) is higher than the bottom 25% of dividend payers in the UK market (2.03%).

High Dividend: TALK's dividend (2.76%) is low compared to the top 25% of dividend payers in the UK market (5.69%).


Stability and Growth of Payments

Stable Dividend: TALK's dividend payments have been volatile in the past 10 years.

Growing Dividend: TALK's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (79.4%), TALK's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TALK's dividends in 3 years are forecast to be covered by earnings (50.4% payout ratio).


Next Steps

Management

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

2.3yrs

Average management tenure


CEO

Tristia Harrison

3.08yrs

Tenure

UK£542,000

Compensation

Ms. Tristia Harrison has been the Chief Executive Officer at TalkTalk Telecom Group PLC since May 2017. Ms. Harrison has been an Executive Director of TalkTalk Telecom Group PLC since June 3, 2014. She has ...


CEO Compensation Analysis

Compensation vs Market: Tristia's total compensation ($USD668.96K) is below average for companies of similar size in the UK market ($USD1.76M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Charles Dunstone
Executive Chairman10.08yrsUK£388.00k29.9% £309.4m
Tristia Harrison
CEO & Executive Director3.08yrsUK£542.00k0.19% £1.9m
Kate Ferry
CFO & Director2.58yrsUK£435.00k0.012% £126.8k
Gary Steen
Managing Director of Technology5.83yrsno datano data
Tim Warrington
Head of Investor Relations2.33yrsno datano data
Timothy Morris
Group General Counsel & Company Secretaryno datano datano data
Daniel Kasmir
Chief People Officer1.17yrsno datano data
Jonathan Kini
Managing Director of TalkTalk Business0.67yrno datano data
Nick Gunga
Chief Operating Officer of Consumer2.08yrsno datano data
Sian Doyle
Managing Director of Consumer0.33yrno datano data

2.3yrs

Average Tenure

Experienced Management: TALK's management team is considered experienced (2.3 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Charles Dunstone
Executive Chairman10.08yrsUK£388.00k29.9% £309.4m
Tristia Harrison
CEO & Executive Director3.08yrsUK£542.00k0.19% £1.9m
Kate Ferry
CFO & Director2.58yrsUK£435.00k0.012% £126.8k
Howard Stringer
Independent Non-Executive Director7.83yrsUK£50.00kno data
John Gildersleeve
Independent Deputy Chairman7yrsUK£80.00k0.026% £264.6k
Roger Taylor
Non-Executive Director4.5yrsUK£52.00k0.86% £8.9m
Nigel Langstaff
Independent Non-Executive Director2.5yrsUK£58.00k0.026% £271.7k
Ian West
Senior Independent Non-Executive Director7yrsUK£80.00k0.032% £330.6k
Paul Reynolds
Independent Non-Executive Director0.083yrno datano data
Phil Jordan
Non-Executive Director1.58yrsUK£25.00kno data

5.2yrs

Average Tenure

58.5yo

Average Age

Experienced Board: TALK's board of directors are considered experienced (5.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: TALK 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

TalkTalk Telecom Group PLC's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: TalkTalk Telecom Group PLC
  • Ticker: TALK
  • Exchange: LSE
  • Founded: 2002
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: UK£1.035b
  • Shares outstanding: 1.14b
  • Website: https://www.talktalkgroup.com

Number of Employees


Location

  • TalkTalk Telecom Group PLC
  • Soapworks
  • Ordsdall Lane
  • Salford
  • M5 3TT
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
TALKLSE (London Stock Exchange)YesOrdinary SharesGBGBPMar 2010
TLKT.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMar 2010
TALKLBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBGBPMar 2010
TK6DB (Deutsche Boerse AG)YesOrdinary SharesDEEURMar 2010
TKTC.YOTCPK (Pink Sheets LLC)UNSPONSORD ADRUSUSDSep 2010

Biography

TalkTalk Telecom Group PLC provides fixed line, TV, and mobile telecommunications services for residential, retail, and business customers in the United Kingdom. It offers landline, broadband, fiber, TV, and mobile services, including fixed price plans and unlimited broadband usage, as well as HomeSafe, a network-based security and filtering system. The company also provides various business-grade communications products and services, including Internet access, data, voice, and mobile. TalkTalk Telecom Group PLC was founded in 2002 and is based in Salford, the United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/30 23:30
End of Day Share Price2020/05/29 00:00
Earnings2019/09/30
Annual Earnings2019/03/31


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.