NZSE:LIC

Stock Analysis Report

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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. More Details


Snowflake Analysis

Flawless balance sheet and undervalued.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

1.3%

LIC

-0.5%

NZ Food

0.2%

NZ Market


1 Year Return

-8.2%

LIC

5.9%

NZ Food

5.6%

NZ Market

Return vs Industry: LIC underperformed the NZ Food industry which returned 5.9% over the past year.

Return vs Market: LIC underperformed the NZ Market which returned 5.6% over the past year.


Shareholder returns

LICIndustryMarket
7 Day1.3%-0.5%0.2%
30 Day5.4%-5.6%6.8%
90 Day1.3%-14.9%7.0%
1 Year6.9%-8.2%6.8%5.9%9.9%5.6%
3 Year81.0%35.7%11.2%6.9%47.4%28.1%
5 Year7.0%-22.0%127.7%91.2%100.4%51.5%

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

Below Fair Value: LIC (NZ$0.78) is trading below our estimate of fair value (NZ$2.69)

Significantly Below Fair Value: 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 (6.5x) compared to the NZ Food industry average (13.8x).

PE vs Market: LIC is good value based on its PE Ratio (6.5x) compared to the NZ market (22.9x).


Price to Earnings Growth Ratio

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 (1.4x).


Next Steps

Future Growth

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

13.0%

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 Livestock Improvement 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 Livestock Improvement performed over the past 5 years?

32.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LIC has a large one-off loss of NZ$7.2M impacting its May 31 2020 financial results.

Growing Profit Margin: LIC's current net profit margins (6.9%) are lower than last year (9%).


Past Earnings Growth Analysis

Earnings Trend: LIC's earnings have grown significantly by 32.5% per year over the past 5 years.

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

Earnings vs Industry: LIC had negative earnings growth (-21.1%) over the past year, making it difficult to compare to the Food industry average (15.8%).


Return on Equity

High ROE: LIC's Return on Equity (6%) is considered low.


Next Steps

Financial Health

How is Livestock Improvement's financial position?


Financial Position Analysis

Short Term Liabilities: LIC's short term assets (NZ$87.7M) exceed its short term liabilities (NZ$34.1M).

Long Term Liabilities: LIC's short term assets (NZ$87.7M) exceed its long term liabilities (NZ$55.6M).


Debt to Equity History and Analysis

Debt Level: LIC's debt to equity ratio (0.6%) is considered satisfactory.

Reducing Debt: LIC's debt to equity ratio has reduced from 8.2% to 0.6% over the past 5 years.

Debt Coverage: LIC's debt is well covered by operating cash flow (3218.9%).

Interest Coverage: LIC's interest payments on its debt are well covered by EBIT (47.9x coverage).


Balance Sheet


Next Steps

Dividend

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

16.34%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: LIC's dividend (16.34%) is higher than the bottom 25% of dividend payers in the NZ market (2.72%).

High Dividend: LIC's dividend (16.34%) is in the top 25% of dividend payers in the NZ market (4.49%)


Stability and Growth of Payments

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 high payout ratio (106.2%), LIC's dividend payments are not 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?

3.4yrs

Average management tenure


CEO

Wayne McNee

7.25yrs

Tenure

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 ...


Leadership Team

NamePositionTenureCompensationOwnership
Wayne McNee
Chief Executive Officer7.25yrsno datano data
David Hazlehurst
Chief Financial Officer1.67yrsno datano data
David Chin
General Manager of Operations & Service0.92yrno datano data
Richard Spelman
Chief Scientist6.33yrsno datano data
Andrea Black
Chief Information Officer0.75yrno datano data
Ashleigh Sattler
Communications Manager3.58yrsno datano data
Roz Urbahn
Chief People Officer3.17yrsno datano data
Gillian Brennan
Company Secretary7.5yrsno datano data

3.4yrs

Average Tenure

Experienced Management: LIC's management team is considered experienced (3.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Gray Baldwin
Director8.33yrsNZ$51.00k0.010%
NZ$ 11.1k
Murray King
Independent Chairmanno dataNZ$120.00k0.095%
NZ$ 105.3k
Timothy Gibson
Independent Director3yrsNZ$65.00kno data
Kenneth Hames
Independent Director1.33yrsno data0.0022%
NZ$ 2.5k
David Jensen
Independent Director8.33yrsNZ$51.00k0.013%
NZ$ 14.4k
Sophie Haslem
Independent Director1.83yrsNZ$27.00kno data
Alison Watters
Independent Director6.33yrsNZ$51.00k0.024%
NZ$ 26.2k
Candace Reed
Independent Director5yrsNZ$63.00kno data
Matt Ross
Independent Director3.33yrsNZ$51.00k0.065%
NZ$ 72.6k
Ben Dickie
Independent Director2.33yrsNZ$51.00k0.017%
NZ$ 18.7k

3.3yrs

Average Tenure

Experienced Board: LIC's board of directors are considered experienced (3.3 years average tenure).


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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

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$111.029m
  • 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 Analysis2020/10/21 10:38
End of Day Share Price2020/10/21 00:00
Earnings2020/05/31
Annual Earnings2020/05/31


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.