NZSE:LIC

Stock Analysis Report

Executive Summary

Livestock Improvement Corporation Limited, together with its subsidiaries, develops, produces, and markets artificial breeding, genetics, farm software, farm automation, and herd testing services.

Snowflake

Fundamentals

Flawless balance sheet, undervalued and pays a dividend.

Share Price & News

How has Livestock Improvement's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0%

LIC

3.0%

NZ Food

2.0%

NZ Market


1 Year Return

21.4%

LIC

3.1%

NZ Food

18.6%

NZ Market

Return vs Industry: LIC exceeded the NZ Food industry which returned 3.1% over the past year.

Return vs Market: LIC exceeded the NZ Market which returned 18.6% over the past year.


Shareholder returns

LICIndustryMarket
7 Day0%3.0%2.0%
30 Day0%3.7%2.9%
90 Day-5.6%-10.3%3.1%
1 Year35.9%21.4%4.7%3.1%23.8%18.6%
3 Year51.0%28.3%61.9%48.4%56.4%35.9%
5 Year-30.9%-44.3%95.5%60.4%104.3%58.3%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Livestock Improvement undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: LIC (NZ$0.85) is trading below our estimate of fair value (NZ$14.45)

Significantly Undervalued: LIC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: LIC is good value based on its PE Ratio (5.3x) compared to the Food industry average (18.9x).

PE vs Market: LIC is good value based on its PE Ratio (5.3x) compared to the NZ market (18.6x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: LIC is good value based on its PB Ratio (0.4x) compared to the NZ Food industry average (1.1x).


Next Steps

Future Growth

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

3.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LIC's forecast earnings growth (3% per year) is above the savings rate (2.4%).

Earnings vs Market: LIC's earnings (3% per year) are forecast to grow slower than the NZ market (7% per year).

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

Revenue vs Market: Insufficient data to determine if LIC's revenue is forecast to grow faster than the NZ market.

High Growth Revenue: Insufficient data to determine if LIC's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

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


Next Steps

Past Performance

How has Livestock Improvement performed over the past 5 years?

12.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: LIC's earnings have grown by 12.8% per year over the past 5 years.

Accelerating Growth: LIC's earnings growth over the past year (139.3%) exceeds its 5-year average (12.8% per year).

Earnings vs Industry: LIC earnings growth over the past year (139.3%) exceeded the Food industry -3.4%.


Return on Equity

High ROE: LIC's Return on Equity (7.6%) is considered low.


Return on Assets

ROA vs Industry: LIC has a higher Return on Assets than the Food industry average last year.


Return on Capital Employed

ROCE Improving: LIC has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Livestock Improvement's financial position?


Financial Position Analysis

Short Term Liabilities: LIC's short term assets (NZ$85.7M) exceeds its short term liabilities (NZ$39.8M)

Long Term Liabilities: LIC's short term assets (85.7M) exceeds its long term liabilities (49.5M)


Debt to Equity History and Analysis

Debt Level: LIC's debt to equity ratio (1.6%) is considered satisfactory

Reducing Debt: LIC's debt to equity ratio has reduced from 3% to 1.6% over the past 5 years.

Debt Coverage: LIC's debt is well covered by operating cash flow (1183.6%).

Interest Coverage: LIC's interest payments on its debt are well covered by EBIT (81.1x coverage).


Balance Sheet

Inventory Level: LIC has a high level of physical assets or inventory.

Debt Coverage by Assets: LIC's debt is covered by short term assets (assets are 18.376740x debt).


Next Steps

Dividend

What is Livestock Improvement's current dividend yield, its reliability and sustainability?

12.91%

Current Dividend Yield


Dividend Yield vs Market

company12.9%marketbottom25%3.0%markettop25%5.6%industryaverage4.1%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: LIC's dividend (12.91%) is higher than the bottom 25% of dividend payers in the NZ market (2.99%).

High Dividend: LIC's dividend (12.91%) is in the top 25% of dividend payers in the NZ market (5.62%)

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

Growing Dividend: LIC's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (68.6%), LIC's dividend payments are 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

What is the CEO of Livestock Improvement's salary, the management and board of directors tenure and is there insider trading?

3.0yrs

Average management tenure


CEO

Wayne McNee 0

6.3yrs

Tenure

0

Mr. Wayne McNee has been the Chief Executive Officer at Livestock Improvement Corporation Limited since July 2013. Mr. McNee was Director-General for the Ministry for Primary Industries (MPI) since Novembe ...


Management Age and Tenure

3.0yrs

Average Tenure

Experienced Management: LIC's management team is considered experienced (3 years average tenure).


Board Age and Tenure

5.3yrs

Average Tenure

Experienced Board: LIC's board of directors are considered experienced (5.3 years average tenure).


Insider Trading

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


Ownership Breakdown


Management Team

  • David Hazlehurst

    Chief Financial Officer

    • Tenure: 0.7yrs
  • Brent Wollaston

    Acting General Manager of Operations & Service

    • Tenure: 1.3yrs
  • Richard Spelman

    Chief Scientist

    • Tenure: 5.3yrs
  • Wayne McNee

    Chief Executive Officer

    • Tenure: 6.3yrs
  • Geoff Corbett

    Chief Executive Officer of LIC Automation

    • Tenure: 1.9yrs
  • Gillian Brennan

    Company Secretary

    • Tenure: 6.5yrs
  • Paul Littlefair

    Chief Information Officer

    • Tenure: 3.9yrs
  • Roz Urbahn

    Chief People Officer

    • Tenure: 2.2yrs

Board Members

  • Phil Lough

    Independent Director

    • Tenure: 17yrs
    • Compensation: NZ$60.00k
  • Murray Jagger

    Director

    • Tenure: 19.3yrs
    • Compensation: NZ$47.00k
  • Gray Baldwin

    Director

    • Tenure: 7.3yrs
    • Compensation: NZ$47.00k
  • Murray King

    Chairman

    • Tenure: 0yrs
    • Compensation: NZ$114.00k
  • David Jensen

    Director

    • Tenure: 7.3yrs
    • Compensation: NZ$47.00k
  • Sophie Haslem

    Independent Director

    • Tenure: 0.8yrs
  • Alison Watters

    Director

    • Tenure: 5.3yrs
    • Compensation: NZ$47.00k
  • Candace Reed

    Independent Director

    • Tenure: 4yrs
    • Compensation: NZ$28.00k
  • Matt Ross

    Director

    • Tenure: 2.3yrs
  • Ben Dickie

    Director

    • Tenure: 1.3yrs

Company Information

Livestock Improvement Corporation Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Livestock Improvement Corporation Limited
  • Ticker: LIC
  • Exchange: NZSE
  • Founded: 1909
  • Industry: Packaged Foods and Meats
  • Sector: Food, Beverage & Tobacco
  • Market Cap: NZ$120.993m
  • Shares outstanding: 142.34m
  • Website: https://www.lic.co.nz

Location

  • Livestock Improvement Corporation Limited
  • Corner Ruakura and Morrinsville Roads
  • Newstead
  • Hamilton
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LICNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDApr 2004

Biography

Livestock Improvement Corporation Limited, together with its subsidiaries, develops, produces, and markets artificial breeding, genetics, farm software, farm automation, and herd testing services. The comp ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/17 10:31
End of Day Share Price2019/10/15 00:00
Earnings2019/05/31
Annual Earnings2019/05/31


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.