Royal Mail plc, together with its subsidiaries, operates as a universal postal service provider in Italy, France, Spain, Germany, North America, Croatia, the Czech Republic, Hungary, Poland, Romania, Slovakia, Slovenia, Austria, Belgium, Denmark, Ireland, the Netherlands, and Portugal. More Details
Undervalued with excellent balance sheet.
Share Price & News
How has Royal Mail's share price performed over time and what events caused price changes?
Latest Share Price and Events
Stable Share Price: RMG is not significantly more volatile than the rest of UK stocks over the past 3 months, typically moving +/- 4% a week.
Volatility Over Time: RMG's weekly volatility (4%) has been stable over the past year.
7 Day Return
1 Year Return
Return vs Industry: RMG exceeded the UK Logistics industry which returned 74.6% over the past year.
Return vs Market: RMG exceeded the UK Market which returned 22.4% over the past year.
Long-Term Price Volatility Vs. Market
How volatile is Royal Mail's share price compared to the market and industry in the last 5 years?
Simply Wall St News
6 days ago | Simply Wall StRoyal Mail (LON:RMG) Could Be A Buy For Its Upcoming Dividend
2 weeks ago | Simply Wall StInvestors Who Bought Royal Mail (LON:RMG) Shares A Year Ago Are Now Up 215%
1 month ago | Simply Wall StIs Now The Time To Look At Buying Royal Mail plc (LON:RMG)?
Is Royal Mail undervalued compared to its fair value and its price relative to the market?
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: RMG (£5.04) is trading below our estimate of fair value (£7.78)
Significantly Below Fair Value: RMG is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: RMG is good value based on its PE Ratio (8.1x) compared to the European Logistics industry average (24.1x).
PE vs Market: RMG is good value based on its PE Ratio (8.1x) compared to the UK market (23.6x).
Price to Earnings Growth Ratio
PEG Ratio: RMG is poor value based on its PEG Ratio (14.5x)
Price to Book Ratio
PB vs Industry: RMG is good value based on its PB Ratio (1x) compared to the XE Logistics industry average (3.9x).
How is Royal Mail forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: RMG's forecast earnings growth (0.6% per year) is below the savings rate (0.9%).
Earnings vs Market: RMG's earnings (0.6% per year) are forecast to grow slower than the UK market (14.8% per year).
High Growth Earnings: RMG's earnings are forecast to grow, but not significantly.
Revenue vs Market: RMG's revenue (2.4% per year) is forecast to grow slower than the UK market (4.7% per year).
High Growth Revenue: RMG's revenue (2.4% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: RMG's Return on Equity is forecast to be low in 3 years time (11.8%).
How has Royal Mail performed over the past 5 years?
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: RMG has a large one-off loss of £186.0M impacting its March 28 2021 financial results.
Growing Profit Margin: RMG's current net profit margins (4.9%) are higher than last year (1.5%).
Past Earnings Growth Analysis
Earnings Trend: RMG's earnings have grown by 1.9% per year over the past 5 years.
Accelerating Growth: RMG's earnings growth over the past year (283%) exceeds its 5-year average (1.9% per year).
Earnings vs Industry: RMG earnings growth over the past year (283%) exceeded the Logistics industry 24.5%.
Return on Equity
High ROE: RMG's Return on Equity (12.9%) is considered low.
How is Royal Mail's financial position?
Financial Position Analysis
Short Term Liabilities: RMG's short term assets (£3.3B) exceed its short term liabilities (£2.7B).
Long Term Liabilities: RMG's short term assets (£3.3B) exceed its long term liabilities (£2.5B).
Debt to Equity History and Analysis
Debt Level: RMG's debt to equity ratio (18.6%) is considered satisfactory.
Reducing Debt: RMG's debt to equity ratio has increased from 8.8% to 18.6% over the past 5 years.
Debt Coverage: RMG's debt is well covered by operating cash flow (131.1%).
Interest Coverage: RMG's interest payments on its debt are well covered by EBIT (25.7x coverage).
What is Royal Mail current dividend yield, its reliability and sustainability?
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: RMG's dividend (1.98%) is higher than the bottom 25% of dividend payers in the UK market (1.31%).
High Dividend: RMG's dividend (1.98%) is low compared to the top 25% of dividend payers in the UK market (4%).
Stability and Growth of Payments
Stable Dividend: RMG has been paying a dividend for less than 10 years and during this time payments have been volatile.
Growing Dividend: RMG has only been paying a dividend for 7 years, and since then payments have fallen.
Current Payout to Shareholders
Dividend Coverage: With its low payout ratio (16.1%), RMG's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: RMG's dividends in 3 years are forecast to be well covered by earnings (42.6% payout ratio).
How experienced are the management team and are they aligned to shareholders interests?
Average management tenure
Mr. Simon Thompson serves as Chief Executive Officer at Royal Mail plc since January 11, 2021. He has been a Non Executive Director of Royal Mail plc since November 1, 2017 and serves as Chief Executive of...
CEO Compensation Analysis
Compensation vs Market: Simon's total compensation ($USD258.65K) is below average for companies of similar size in the UK market ($USD2.23M).
Compensation vs Earnings: Simon's compensation has increased by more than 20% in the past year.
Experienced Management: RMG's management team is considered experienced (3 years average tenure).
Experienced Board: RMG's board of directors are not considered experienced ( 2.2 years average tenure), which suggests a new board.
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.
Recent Insider Transactions
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Royal Mail plc's company bio, employee growth, exchange listings and data sources
- Name: Royal Mail plc
- Ticker: RMG
- Exchange: LSE
- Founded: 2013
- Industry: Air Freight and Logistics
- Sector: Transportation
- Market Cap: UK£5.039b
- Shares outstanding: 999.43m
- Website: https://www.royalmailgroup.com
Number of Employees
- Royal Mail plc
- 185 Farringdon Road
- Greater London
- EC1A 1AA
- United Kingdom
Royal Mail plc, together with its subsidiaries, operates as a universal postal service provider in Italy, France, Spain, Germany, North America, Croatia, the Czech Republic, Hungary, Poland, Romania, Slova...
Company Analysis and Financial Data Status
|Data||Last Updated (UTC time)|
|Company Analysis||2021/07/31 04:00|
|End of Day Share Price||2021/07/30 00:00|
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.