NZSE:ALF

Stock Analysis Report

Executive Summary

Allied Farmers Limited, through its subsidiaries, provides rural services.

Rewards

Trading at 92.6% below its fair value

Risk Analysis

Does not have a meaningful market cap (NZ$12M)

Has a high level of debt

Shareholders have been diluted in the past year



Snowflake Analysis

Excellent balance sheet and good value.

Share Price & News

How has Allied Farmers's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0%

ALF

1.6%

NZ Food

0.3%

NZ Market


1 Year Return

-14.5%

ALF

3.4%

NZ Food

21.9%

NZ Market

Return vs Industry: ALF underperformed the NZ Food industry which returned 1.9% over the past year.

Return vs Market: ALF underperformed the NZ Market which returned 21.1% over the past year.


Shareholder returns

ALFIndustryMarket
7 Day0%1.6%0.3%
30 Day1.4%0.6%-0.2%
90 Day0%2.3%7.2%
1 Year-11.9%-14.5%4.7%3.4%26.9%21.9%
3 Year6.4%-1.4%59.2%46.0%60.1%39.2%
5 Year9.4%1.4%119.0%79.3%98.3%54.2%

Price Volatility Vs. Market

How volatile is Allied Farmers's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Allied Farmers 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: ALF (NZ$0.71) is trading below our estimate of fair value (NZ$9.54)

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


Price To Earnings Ratio

PE vs Industry: ALF is good value based on its PE Ratio (9.4x) compared to the Food industry average (15.7x).

PE vs Market: ALF is good value based on its PE Ratio (9.4x) compared to the NZ market (19.8x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ALF's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ALF is overvalued based on its PB Ratio (2.9x) compared to the NZ Food industry average (1.2x).


Next Steps

Future Growth

How is Allied Farmers forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

14.6%

Forecasted Food, Beverage & Tobacco industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Allied Farmers has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Allied Farmers performed over the past 5 years?

16.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ALF has high quality earnings.

Growing Profit Margin: ALF's current net profit margins (5.9%) are lower than last year (8.2%).


Past Earnings Growth Analysis

Earnings Trend: ALF's earnings have grown by 16% per year over the past 5 years.

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

Earnings vs Industry: ALF had negative earnings growth (-18%) over the past year, making it difficult to compare to the Food industry average (-9.7%).


Return on Equity

High ROE: ALF's Return on Equity (34.7%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Allied Farmers's financial position?


Financial Position Analysis

Short Term Liabilities: ALF's short term assets (NZ$18.7M) exceed its short term liabilities (NZ$15.4M).

Long Term Liabilities: ALF's short term assets (NZ$18.7M) exceed its long term liabilities (NZ$2.9M).


Debt to Equity History and Analysis

Debt Level: ALF's debt to equity ratio (77.6%) is considered high.

Reducing Debt: ALF had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: ALF's debt is well covered by operating cash flow (68.6%).

Interest Coverage: ALF's interest payments on its debt are well covered by EBIT (4.7x coverage).


Balance Sheet

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

Debt Coverage by Assets: ALF's debt is covered by short term assets (assets are 4.2x debt).


Next Steps

Dividend

What is Allied Farmers's current dividend yield, its reliability and sustainability?

2.82%

Current Dividend Yield


Dividend Yield vs Market

company2.8%marketbottom25%2.9%markettop25%5.5%industryaverage4.2%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: ALF's dividend (2.82%) isn’t notable compared to the bottom 25% of dividend payers in the NZ market (2.87%).

High Dividend: ALF's dividend (2.82%) is low compared to the top 25% of dividend payers in the NZ market (5.62%).


Stability and Growth of Payments

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

Growing Dividend: ALF has only been paying a dividend for 2 years, and since then payments have not increased.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (26.4%), ALF's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

9.3yrs

Average board tenure


CEO

Allied Farmers has no CEO, or we have no data on them.


Board Members

NamePositionTenureCompensationOwnership
G. McDouall
Independent Director20.3yrsno data0.037% NZ$4.7k
Garry Bluett
Independent Chairman0yrsno data1.75% NZ$218.9k
Philip Luscombe
Independent Director14.2yrsno data0.27% NZ$33.4k
Mark Benseman
Director4.3yrsNZ$31.21kno data
Marise James
Director1.3yrsno datano data

9.3yrs

Average Tenure

Experienced Board: ALF's board of directors are considered experienced (9.3 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: ALF insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 2.8%.


Top Shareholders

Company Information

Allied Farmers Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Allied Farmers Limited
  • Ticker: ALF
  • Exchange: NZSE
  • Founded: 1913
  • Industry: Agricultural Products
  • Sector: Food, Beverage & Tobacco
  • Market Cap: NZ$12.498m
  • Shares outstanding: 17.85m
  • Website: https://www.alliedfarmers.co.nz

Location

  • Allied Farmers Limited
  • 201 Broadway
  • Stratford
  • 4332
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ALFNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDMay 2002

Biography

Allied Farmers Limited, through its subsidiaries, provides rural services. The company engages in livestock trading; and procurement and processing of calves; as well as provision of livestock financing, asset management, and nominee services. It also provides online services through digital platform MyLivestock. The company was formerly known as The Farmers Co-operative Organisation Society of New Zealand Limited and changed its name to Allied Farmers Limited in 1996. Allied Farmers Limited was founded in 1913 and is based in Stratford, New Zealand. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/18 10:33
End of Day Share Price2020/02/17 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


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.