NZSE:PGW

Stock Analysis Report

Executive Summary

PGG Wrightson Limited provides goods and services for agricultural sector in New Zealand.


Snowflake Analysis

Excellent balance sheet and fair value.

Share Price & News

How has PGG Wrightson's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

0%

PGW

1.6%

NZ Food

0.3%

NZ Market


1 Year Return

-55.4%

PGW

3.4%

NZ Food

21.9%

NZ Market

Return vs Industry: PGW underperformed the NZ Food industry which returned 3.4% over the past year.

Return vs Market: PGW underperformed the NZ Market which returned 21.9% over the past year.


Shareholder returns

PGWIndustryMarket
7 Day0%1.6%0.3%
30 Day-2.5%0.6%-0.2%
90 Day-4.9%2.3%7.2%
1 Year7.9%-55.4%4.7%3.4%26.9%21.9%
3 Year18.8%-57.0%59.2%46.0%60.1%39.2%
5 Year56.5%-53.6%119.0%79.3%98.3%54.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is PGG Wrightson undervalued compared to its fair value and its price relative to the market?

42.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PGW (NZ$2.32) is trading below our estimate of fair value (NZ$4.04)

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


Price To Earnings Ratio

PE vs Industry: PGW is poor value based on its PE Ratio (52.8x) compared to the Food industry average (15.8x).

PE vs Market: PGW is poor value based on its PE Ratio (52.8x) compared to the NZ market (19.8x).


Price to Earnings Growth Ratio

PEG Ratio: PGW is poor value based on its PEG Ratio (2x)


Price to Book Ratio

PB vs Industry: PGW is good value based on its PB Ratio (0.4x) compared to the NZ Food industry average (1.2x).


Next Steps

Future Growth

How is PGG Wrightson forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

27.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PGW's forecast earnings growth (27.1% per year) is above the savings rate (1.3%).

Earnings vs Market: PGW's earnings (27.1% per year) are forecast to grow faster than the NZ market (6.3% per year).

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

Revenue vs Market: PGW's revenue (1.8% per year) is forecast to grow slower than the NZ market (5.1% per year).

High Growth Revenue: PGW's revenue (1.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PGW's Return on Equity is forecast to be low in 3 years time (9.2%).


Next Steps

Past Performance

How has PGG Wrightson performed over the past 5 years?

-17.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PGW has a high level of non-cash earnings.

Growing Profit Margin: PGW's current net profit margins (0.4%) are lower than last year (1%).


Past Earnings Growth Analysis

Earnings Trend: PGW has become profitable over the past 5 years, growing earnings by -17.5% per year.

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

Earnings vs Industry: PGW had negative earnings growth (-59%) over the past year, making it difficult to compare to the Food industry average (-9.7%).


Return on Equity

High ROE: PGW's Return on Equity (1%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is PGG Wrightson's financial position?


Financial Position Analysis

Short Term Liabilities: PGW's short term assets (NZ$495.3M) exceed its short term liabilities (NZ$159.7M).

Long Term Liabilities: PGW's short term assets (NZ$495.3M) exceed its long term liabilities (NZ$7.6M).


Debt to Equity History and Analysis

Debt Level: PGW's debt to equity ratio (0.7%) is considered satisfactory.

Reducing Debt: PGW's debt to equity ratio has reduced from 37.5% to 0.7% over the past 5 years.


Balance Sheet

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

Debt Coverage by Assets: PGW's debt is covered by short term assets (assets are 184.8x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: PGW is profitable, therefore cash runway is not a concern.

Forecast Cash Runway: PGW is profitable, therefore cash runway is not a concern.


Next Steps

Dividend

What is PGG Wrightson's current dividend yield, its reliability and sustainability?

6.47%

Current Dividend Yield


Dividend Yield vs Market

company6.5%marketbottom25%2.9%markettop25%5.5%industryaverage4.2%forecastin3Years7.6%

Current dividend yield vs market & industry

Notable Dividend: PGW's dividend (6.47%) is higher than the bottom 25% of dividend payers in the NZ market (2.87%).

High Dividend: PGW's dividend (6.47%) is in the top 25% of dividend payers in the NZ market (5.53%)


Stability and Growth of Payments

Stable Dividend: PGW has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: PGW's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (341.4%), PGW's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: PGW's dividends in 3 years are forecast to be covered by earnings (83.9% payout ratio).


Next Steps

Management

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

1.0yrs

Average management tenure


CEO

Stephen Guerin 0

0.7yrs

Tenure

Mr. Stephen Guerin serves as Chief Executive Officer at PGG Wrightson Limited since June 1, 2019. He had been Group General Manager of Retail & Water at PGG Wrightson Limited since September 1, 2016 until  ...


Leadership Team

NamePositionTenureCompensationOwnership
Stephen Guerin
Chief Executive Officer0.7yrsno data0.0069% NZ$8.9k
Peter Scott
Chief Financial Officer4.9yrsno datano data
Jane Pearson
Legal Counsel0yrsno datano data
Natalie Thain
Acting General Manager Human Resources1yrsno datano data
Julian Daly
GM of Corporate Affairs & Company Secretary0yrsno datano data

1.0yrs

Average Tenure

Experienced Management: PGW's management team is not considered experienced ( 1 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Joo Hai Lee
Deputy Chairman of the Board0.8yrsNZ$116.74kno data
Kean Seng U.
Director7.2yrsNZ$80.00kno data
John Fulton
Alternate Director4.9yrsno datano data
Rodger Finlay
Independent Chairman0.8yrsNZ$37.47k0.041% NZ$53.1k
Sarah Brown
Independent Director0.8yrsNZ$13.63k0.021% NZ$26.4k
B. Cushing
Independent Director0.8yrsNZ$13.63kno data

0.8yrs

Average Tenure

56.5yo

Average Age

Experienced Board: PGW's board of directors are not considered experienced ( 0.8 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.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

Company Information

PGG Wrightson Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: PGG Wrightson Limited
  • Ticker: PGW
  • Exchange: NZSE
  • Founded: 1841
  • Industry: Agricultural Products
  • Sector: Food, Beverage & Tobacco
  • Market Cap: NZ$128.493m
  • Shares outstanding: 55.39m
  • Website: https://www.pggwrightson.co.nz

Location

  • PGG Wrightson Limited
  • 57 Waterloo Road
  • Hornby
  • Christchurch
  • 8042
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PGWNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDJan 1992
PGWF.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDJan 1992

Biography

PGG Wrightson Limited provides goods and services for agricultural sector in New Zealand. The company operates in two segments, Agency, and Retail & Water. It operates rural supplies stores that offer a range of products, such as animal health and management products; apparel and footwear products; dairy shed hygiene products; fencing products; fertilizers; nutrition products; calf rearing products; pasture and crop protection products; wine making products; water products; horse feeds; seeds; and general merchandise products. The company also provides agency services for the sale, purchase, and service of livestock through auction, private and on-farm sales, and specialist stud stock sales; irrigation and pumping systems to farmers and horticulturists; and agritrade and ancillary support services, as well as markets and exports wool products. In addition, it offers insurance products; and rural finance and investment products to small-to-medium sized business, farms, and families. Further, the company provides real estate services, including rural, lifestyle, residential, and commercial properties; and operates fruitfed supplies retail network that provides plant protection and nutrition products, vegetable seeds, crop monitoring, soil tests and fertilizer recommendations, spray programs, frost fighting solutions and machinery, irrigation services, winery supplies, posts, wire and bird nettings, safety gears, and picking and pruning equipment, as well as protective cropping supplies for glasshouses and undercover crops. PGG Wrightson Limited was founded in 1841 and is based in Christchurch, New Zealand. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 10:33
End of Day Share Price2020/02/18 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.