Sports Toto Berhad (KLSE:SPTOTO) - Share price, News & Analysis

Q: What is the Fair Price of SPTOTO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

SPTOTO (MYR1.84) is trading below our estimate of [[fair value]] (MYR2.9)

SPTOTO fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	3/6
Financial Health	4/6
Dividends	3/6

SPTOTO Stock Overview

Sports Toto Berhad, an investment holding company, operates Toto betting in Malaysia, the United Kingdom, and internationally.

Rewards

Trading at 36.5% below our estimate of its fair value

Earnings are forecast to grow 21.57% per year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Sports Toto Berhad Competitors

Berjaya Food Berhad

KLSE:BJFOOD

RM1.5b

SEG International Bhd

KLSE:SEG

RM778.7m

Delta

BSE:532848

₹52.6b

DYNAM JAPAN HOLDINGS

SEHK:6889

HK$4.8b

Price History & Performance

Summary of all time highs, changes and price drops for Sports Toto Berhad
Historical stock prices
Current Share Price	RM1.84
52 Week High	RM2.10
52 Week Low	RM1.78
Beta	0.32
1 Month Change	2.22%
3 Month Change	-3.16%
1 Year Change	-6.60%
3 Year Change	-32.60%
5 Year Change	-19.65%
Change since IPO	33.33%

Recent News & Updates

May 25

Sports Toto Berhad's (KLSE:SPTOTO) Dividend Will Be Increased To RM0.02

The board of Sports Toto Berhad ( KLSE:SPTOTO ) has announced that it will be increasing its dividend on the 22nd of...

Shareholder Returns

	SPTOTO	MY Hospitality	MY Market
7D	-2.1%	1.8%	1.2%
1Y	-6.6%	0.3%	-3.7%

Return vs Industry: SPTOTO underperformed the MY Hospitality industry which returned -0.3% over the past year.

Return vs Market: SPTOTO underperformed the MY Market which returned -3.5% over the past year.

Price Volatility

Is SPTOTO's price volatile compared to industry and market?
SPTOTO volatility
SPTOTO Average Weekly Movement	2.0%
Hospitality Industry Average Movement	7.3%
Market Average Movement	5.6%
10% most volatile stocks in MY Market	11.7%
10% least volatile stocks in MY Market	2.7%

Stable Share Price: SPTOTO is less volatile than 75% of MY stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: SPTOTO's weekly volatility (2%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1969	n/a	Nerine Tan	https://www.berjaya.com/sports-toto-berhad

Sports Toto Berhad, an investment holding company, operates Toto betting in Malaysia, the United Kingdom, and internationally. The company is also involved in the provision of software and technical support services; development, manufacture, and distribution of computerized wagering and voting systems; and property investment and development activities. In addition, it operates hotels, and health and fitness centers; and provides computer consultancy services and protecting and cleaning services for the environment, as well as offers motor retailing, repair and maintenance, aftersales, and insurance agent and broker services.

Sports Toto Berhad Fundamentals Summary

How do Sports Toto Berhad's earnings and revenue compare to its market cap?
SPTOTO fundamental statistics
Market Cap	RM2.46b
Earnings (TTM)	RM144.80m
Revenue (TTM)	RM4.90b

17.0x

P/E Ratio

0.5x

P/S Ratio

Is SPTOTO overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
SPTOTO income statement (TTM)
Revenue	RM4.90b
Cost of Revenue	RM4.01b
Gross Profit	RM892.34m
Other Expenses	RM747.55m
Earnings	RM144.80m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.11
Gross Margin	18.22%
Net Profit Margin	2.96%
Debt/Equity Ratio	132.1%

How did SPTOTO perform over the long term?

See historical performance and comparison

Dividends

4.3%

Current Dividend Yield

37%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is SPTOTO undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for SPTOTO?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for SPTOTO. This is calculated by dividing SPTOTO's market cap by their current preferred multiple.
What is SPTOTO's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	RM2.46b

SPTOTO key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.7x
Enterprise Value/EBITDA	11.3x
PEG Ratio	0.8x

Price to Earnings Ratio vs Peers

How does SPTOTO's PE Ratio compare to its peers?

SPTOTO PE Ratio vs Peers

The above table shows the PE ratio for SPTOTO vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	20.8x
BJFOOD Berjaya Food Berhad	16x	3.9%	RM1.5b
SEG SEG International Bhd	16.8x	n/a	RM778.7m
532848 Delta	34.3x	n/a	₹52.6b
6889 DYNAM JAPAN HOLDINGS	16.5x	n/a	HK$4.8b
SPTOTO Sports Toto Berhad	17x	21.6%	RM2.5b

Price-To-Earnings vs Peers: SPTOTO is good value based on its Price-To-Earnings Ratio (17x) compared to the peer average (20.8x).

Price to Earnings Ratio vs Industry

How does SPTOTO's PE Ratio compare vs other companies in the Asian Hospitality Industry?

Price-To-Earnings vs Industry: SPTOTO is expensive based on its Price-To-Earnings Ratio (17x) compared to the MY Hospitality industry average (16.1x)

Price to Earnings Ratio vs Fair Ratio

What is SPTOTO's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

SPTOTO PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	17x
Fair PE Ratio	23.7x

Price-To-Earnings vs Fair Ratio: SPTOTO is good value based on its Price-To-Earnings Ratio (17x) compared to the estimated Fair Price-To-Earnings Ratio (23.7x).

Share Price vs Fair Value

What is the Fair Price of SPTOTO when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: SPTOTO (MYR1.84) is trading below our estimate of fair value (MYR2.9)

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

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

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Future Growth

How is Sports Toto Berhad forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

21.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: SPTOTO's forecast earnings growth (21.6% per year) is above the savings rate (3.6%).

Earnings vs Market: SPTOTO's earnings (21.6% per year) are forecast to grow faster than the MY market (10.5% per year).

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

Revenue vs Market: SPTOTO's revenue (9.2% per year) is forecast to grow faster than the MY market (5.3% per year).

High Growth Revenue: SPTOTO's revenue (9.2% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: SPTOTO's Return on Equity is forecast to be high in 3 years time (26%)

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Past Performance

How has Sports Toto Berhad performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-17.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: SPTOTO has high quality earnings.

Growing Profit Margin: SPTOTO's current net profit margins (3%) are higher than last year (2.6%).

Past Earnings Growth Analysis

Earnings Trend: SPTOTO's earnings have declined by 17.6% per year over the past 5 years.

Accelerating Growth: SPTOTO's earnings growth over the past year (35.6%) exceeds its 5-year average (-17.6% per year).

Earnings vs Industry: SPTOTO earnings growth over the past year (35.6%) underperformed the Hospitality industry 38.8%.

Return on Equity

High ROE: SPTOTO's Return on Equity (16.5%) is considered low.

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Financial Health

How is Sports Toto Berhad's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: SPTOTO's short term assets (MYR1.6B) exceed its short term liabilities (MYR1.5B).

Long Term Liabilities: SPTOTO's short term assets (MYR1.6B) exceed its long term liabilities (MYR911.2M).

Debt to Equity History and Analysis

Debt Level: SPTOTO's net debt to equity ratio (67.8%) is considered high.

Reducing Debt: SPTOTO's debt to equity ratio has increased from 130.6% to 132.1% over the past 5 years.

Debt Coverage: SPTOTO's debt is well covered by operating cash flow (27.1%).

Interest Coverage: SPTOTO's interest payments on its debt are well covered by EBIT (5.8x coverage).

Balance Sheet

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Dividend

What is Sports Toto Berhad current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

4.35%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: SPTOTO's dividend (4.35%) is higher than the bottom 25% of dividend payers in the MY market (2.02%).

High Dividend: SPTOTO's dividend (4.35%) is low compared to the top 25% of dividend payers in the MY market (4.86%).

Stability and Growth of Payments

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

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

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (37.1%), SPTOTO's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (60.4%), SPTOTO's dividend payments are covered by cash flows.

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Management

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

5.6yrs

Average management tenure

CEO

Nerine Tan (46 yo)

4.17yrs

Tenure

Ms. Sheik Ping Tan, also known as Nerine, is Chairman of Berjaya Philippines Inc. from November 23, 2021. She has been an Executive Director of Berjaya Sports Toto Berhad since January 1, 2016 and has been...

Leadership Team

Experienced Management: SPTOTO's management team is seasoned and experienced (5.6 years average tenure).

Board Members

Experienced Board: SPTOTO's board of directors are not considered experienced ( 1.2 years average tenure), which suggests a new board.

Ownership

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.

Ownership Breakdown

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

Data	Last Updated (UTC time)
Company Analysis	2022/08/16 00:00
End of Day Share Price	2022/08/16 00:00
Earnings	2022/03/31
Annual Earnings	2021/06/30