AIM:ESL

Stock Analysis Report

Executive Summary

Eddie Stobart Logistics plc provides logistics, distribution, and warehousing services for a range of service sectors and industrial clients in the United Kingdom and internationally.

Rewards

Trading at 94.2% below its fair value

Earnings are forecast to grow 17.45% per year

Earnings grew by 313.3% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 105% is not well covered by earnings

Large one-off items impacting financial results

Shareholders have been diluted in the past year

+ 1 more risk


Snowflake Analysis

Very undervalued with moderate growth potential.

Share Price & News

How has Eddie Stobart Logistics's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ESL has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0%

ESL

1.0%

GB Transportation

0.2%

GB Market


1 Year Return

-94.5%

ESL

2.6%

GB Transportation

12.3%

GB Market

Return vs Industry: ESL underperformed the UK Transportation industry which returned 3.2% over the past year.

Return vs Market: ESL underperformed the UK Market which returned 12.7% over the past year.


Shareholder returns

ESLIndustryMarket
7 Day0%1.0%0.2%
30 Day0%0.4%1.1%
90 Dayn/a1.8%7.2%
1 Year-94.2%-94.5%9.3%2.6%18.2%12.3%
3 Yearn/a30.3%12.2%23.2%7.5%
5 Yearn/a37.2%11.4%41.7%9.0%

Price Volatility Vs. Market

How volatile is Eddie Stobart Logistics's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Eddie Stobart Logistics 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: ESL (£0.06) is trading below our estimate of fair value (£1.04)

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


Price To Earnings Ratio

PE vs Industry: ESL is good value based on its PE Ratio (1.4x) compared to the Transportation industry average (8.2x).

PE vs Market: ESL is good value based on its PE Ratio (1.4x) compared to the UK market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: ESL is good value based on its PEG Ratio (0.1x)


Price to Book Ratio

PB vs Industry: ESL is good value based on its PB Ratio (0.1x) compared to the GB Transportation industry average (1.8x).


Next Steps

Future Growth

How is Eddie Stobart Logistics forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

17.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ESL's forecast earnings growth (17.5% per year) is above the savings rate (0.5%).

Earnings vs Market: ESL's earnings (17.5% per year) are forecast to grow faster than the UK market (11.7% per year).

High Growth Earnings: ESL's earnings are forecast to grow, but not significantly.

Revenue vs Market: ESL's revenue (4% per year) is forecast to grow faster than the UK market (3.6% per year).

High Growth Revenue: ESL's revenue (4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ESL's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Eddie Stobart Logistics performed over the past 5 years?

313.3%

Last years earnings growth


Earnings and Revenue History

Quality Earnings: ESL has a large one-off loss of £8.3M impacting its November 30 2018 financial results.

Growing Profit Margin: ESL's current net profit margins (1.9%) are higher than last year (0.6%).


Past Earnings Growth Analysis

Earnings Trend: Insufficient data to determine if ESL's year-on-year earnings growth rate was positive over the past 5 years.

Accelerating Growth: Insufficient data to compare ESL's past year earnings growth to its 5-year average.

Earnings vs Industry: ESL earnings growth over the past year (313.3%) exceeded the Transportation industry 14.9%.


Return on Equity

High ROE: ESL's Return on Equity (6.9%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Eddie Stobart Logistics's financial position?


Financial Position Analysis

Short Term Liabilities: ESL's short term assets (£239.5M) exceed its short term liabilities (£216.0M).

Long Term Liabilities: ESL's short term assets (£239.5M) exceed its long term liabilities (£173.7M).


Debt to Equity History and Analysis

Debt Level: ESL's debt to equity ratio (65.8%) is considered high.

Reducing Debt: Insufficient data to determine if ESL's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: ESL's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: ESL's interest payments on its debt are well covered by EBIT (6.8x coverage).


Balance Sheet

Inventory Level: ESL has a low level of unsold assets or inventory.

Debt Coverage by Assets: ESL's debt is covered by short term assets (assets are 1.5x debt).


Next Steps

Dividend

What is Eddie Stobart Logistics's current dividend yield, its reliability and sustainability?

105.00%

Current Dividend Yield


Dividend Yield vs Market

company105.0%marketbottom25%1.8%markettop25%5.0%industryaverage7.0%forecastin3Years118.7%

Current dividend yield vs market & industry

Notable Dividend: ESL's dividend (105%) is higher than the bottom 25% of dividend payers in the UK market (1.83%).

High Dividend: ESL's dividend (105%) is in the top 25% of dividend payers in the UK market (4.95%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ESL has been paying a dividend for less than 10 years.

Growing Dividend: ESL's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (142.3%), ESL's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ESL's dividends in 3 years are forecast to be covered by earnings (53.2% payout ratio).


Next Steps

Management

What is the CEO of Eddie Stobart Logistics's salary, the management and board of directors tenure and is there insider trading?

2.8yrs

Average board tenure


CEO

Eddie Stobart Logistics has no CEO, or we have no data on them.


Board Age and Tenure

2.8yrs

Average Tenure

64yo

Average Age

Experienced Board: ESL's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUK£19,80015 Apr 19
Stephen Harley
EntityIndividual
Role
Member of the Board of Directors
Non-Executive Director
Shares20,000
Max PriceUK£0.99
BuyUK£24,37508 Apr 19
Philip Swatman
EntityIndividual
Shares25,000
Max PriceUK£0.97

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 13.2%.


Management Team

  • Ba Milt Court (58yo)

    Chief Information Officer

    • Dave Pickering (46yo)

      Chief Operating Officer of Transport Operations

      • Mark Duggan

        Managing Director – The Pallet Network

        • Angelina Miley (41yo)

          Human Resource Director

          • Elaine Williams

            Legal Director & Company Secretary

            • Simon Edwards

              Managing Director of Logistics People

              • Raf Hustinx

                Managing Director Europe

                • Mike Smith

                  Managing Director of Speedy Freight

                  • Dave Simpson

                    Special Operations Director


                    Board Members

                    • Christopher Casey (64yo)

                      Non-Executive Director

                      • Tenure: 2.8yrs
                      • Compensation: UK£70.00k
                    • Stephen Harley (67yo)

                      Non-Executive Director

                      • Tenure: 2.8yrs
                      • Compensation: UK£60.00k
                    • Sébastien Desreumaux (47yo)

                      Director

                      • Tenure: 0.2yrs

                    Company Information

                    Eddie Stobart Logistics plc's company bio, employee growth, exchange listings and data sources


                    Key Information

                    • Name: Eddie Stobart Logistics plc
                    • Ticker: ESL
                    • Exchange: AIM
                    • Founded: 1970
                    • Industry: Trucking
                    • Sector: Transportation
                    • Market Cap: UK£22.659m
                    • Shares outstanding: 377.66m
                    • Website: https://www.eddiestobart.com

                    Number of Employees


                    Location

                    • Eddie Stobart Logistics plc
                    • Stretton Green Distribution Park
                    • Langford Way
                    • Warrington
                    • Cheshire
                    • WA4 4TQ
                    • United Kingdom

                    Listings

                    TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
                    ESLAIM (London Stock Exchange AIM Market)YesOrdinary SharesGBGBPApr 2017
                    9ESBST (Boerse-Stuttgart)YesOrdinary SharesDEEURApr 2017

                    Biography

                    Eddie Stobart Logistics plc provides logistics, distribution, and warehousing services for a range of service sectors and industrial clients in the United Kingdom and internationally. It operates through Road Transport, Contract Logistics and Warehousing, and EU Transport segments. The company offers road transportation services through a fleet of trucks and trailers; and contract logistics and warehousing services, and shipping container services. It also provides courier and express freight services; rail freight services; pallet distribution services; and recruitment services for the logistics sector. The company primarily serves manufacturing, industrial and bulk, e-commerce, retail, and consumer sectors. The company was formerly known as Greenwhitestar UK plc and changed its name to Eddie Stobart Logistics plc in April 2017. Eddie Stobart Logistics plc was founded in 1970 and is headquartered in Warrington, the United Kingdom. 


                    Company Analysis and Financial Data Status

                    All financial data provided by Standard & Poor's Capital IQ.
                    DataLast Updated (UTC time)
                    Company Analysis2020/01/21 22:35
                    End of Day Share Price2019/12/05 00:00
                    Earnings2018/11/30
                    Annual Earnings2018/11/30


                    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.