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TWR

TowerNZSE:TWR Stock Report

Market Cap

NZ$269.9m

7D

0%

1Y

12.3%

Updated

26 Oct, 2021

Data

Company Financials +
TWR fundamental analysis
Snowflake Score
Valuation2/6
Future Growth4/6
Past Performance2/6
Financial Health5/6
Dividends3/6

TWR Overview

Tower Limited provides general insurance products in New Zealand and the Pacific Islands.

Price History & Performance

Summary of all time highs, changes and price drops for Tower
Historical stock prices
Current Share PriceNZ$0.64
52 Week HighNZ$0.56
52 Week LowNZ$0.89
Beta0.43
1 Month Change-3.76%
3 Month Change-7.25%
1 Year Change12.28%
3 Year Change-14.09%
5 Year Change-28.89%
Change since IPO-88.15%

Recent News & Updates

Shareholder Returns

TWRNZ InsuranceNZ Market
7D0%1.1%0.5%
1Y12.3%32.1%2.1%

Return vs Industry: TWR underperformed the NZ Insurance industry which returned 32.1% over the past year.

Return vs Market: TWR exceeded the NZ Market which returned 2.1% over the past year.

Price Volatility

Is TWR's price volatile compared to industry and market?
TWR volatility
TWR Beta0.43
Industry Beta0.72
Market Beta1

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

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

About the Company

FoundedEmployeesCEOWebsite
1869n/aBlair Turnbullhttps://www.tower.co.nz

Tower Limited provides general insurance products in New Zealand and the Pacific Islands. Its insurance products include car, contents, renters', house, landlord, business, travel, boat, motorbike, lifestyle block and farm, motorhome, and caravan or trailer insurance. The company was founded in 1869 and is based in Auckland, New Zealand.

Tower Fundamentals Summary

How do Tower's earnings and revenue compare to its market cap?
TWR fundamental statistics
Market CapNZ$269.85m
Earnings (TTM)NZ$8.98m
Revenue (TTM)NZ$332.90m

30.0x

P/E Ratio

0.8x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
TWR income statement (TTM)
RevenueNZ$332.90m
Cost of RevenueNZ$299.99m
Gross ProfitNZ$32.91m
ExpensesNZ$23.93m
EarningsNZ$8.98m

Last Reported Earnings

Mar 31, 2021

Next Earnings Date

Nov 23, 2021

Earnings per share (EPS)0.021
Gross Margin9.89%
Net Profit Margin2.70%
Debt/Equity Ratio0%

How did TWR perform over the long term?

See historical performance and comparison

Dividends

7.8%

Current Dividend Yield

117%

Payout Ratio

Valuation

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

30.05x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: TWR (NZ$0.64) is trading above our estimate of fair value (NZ$0.42)

Significantly Below Fair Value: TWR is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: TWR's PE Ratio (30x) is in line with the Oceanic Insurance industry average.

PE vs Market: TWR is poor value based on its PE Ratio (30x) compared to the NZ market (22.2x).


Price to Earnings Growth Ratio

PEG Ratio: TWR is good value based on its PEG Ratio (1x)


Price to Book Ratio

PB vs Industry: TWR is good value based on its PB Ratio (0.8x) compared to the XO Insurance industry average (3.5x).


Future Growth

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

31.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TWR's forecast earnings growth (31.5% per year) is above the savings rate (2.1%).

Earnings vs Market: TWR's earnings (31.5% per year) are forecast to grow faster than the NZ market (9.2% per year).

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

Revenue vs Market: TWR's revenue (6.3% per year) is forecast to grow faster than the NZ market (5.3% per year).

High Growth Revenue: TWR's revenue (6.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TWR's Return on Equity is forecast to be low in 3 years time (7.7%).


Past Performance

How has Tower performed over the past 5 years?

61.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TWR has high quality earnings.

Growing Profit Margin: TWR's current net profit margins (2.7%) are lower than last year (6.1%).


Past Earnings Growth Analysis

Earnings Trend: TWR has become profitable over the past 5 years, growing earnings by 61.3% per year.

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

Earnings vs Industry: TWR had negative earnings growth (-53.7%) over the past year, making it difficult to compare to the Insurance industry average (50.3%).


Return on Equity

High ROE: TWR's Return on Equity (2.7%) is considered low.


Financial Health

How is Tower's financial position?


Financial Position Analysis

Short Term Liabilities: TWR's short term assets (NZ$295.8M) do not cover its short term liabilities (NZ$355.9M).

Long Term Liabilities: TWR's short term assets (NZ$295.8M) exceed its long term liabilities (NZ$15.6M).


Debt to Equity History and Analysis

Debt Level: TWR is debt free.

Reducing Debt: TWR has no debt compared to 5 years ago when its debt to equity ratio was 0%.

Debt Coverage: TWR has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: TWR has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Dividend

What is Tower current dividend yield, its reliability and sustainability?

7.81%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TWR's dividend (7.81%) is higher than the bottom 25% of dividend payers in the NZ market (2.41%).

High Dividend: TWR's dividend (7.81%) is in the top 25% of dividend payers in the NZ market (4.9%)


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (117.3%), TWR's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TWR's dividends in 3 years are forecast to be covered by earnings (75.4% payout ratio).


Next Steps

Management

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

1.2yrs

Average management tenure


CEO

Blair Turnbull

1.17yrs

Tenure

NZ$678,000

Compensation

Mr. Blair McLaren Turnbull serves as Chief Digital Officer at Aviva Plc since September 2019. He serves as a Chief Executive Officer at Tower Limited since August 1, 2020. He served as Head for Wealth Mana...


CEO Compensation Analysis

Compensation vs Market: Blair's total compensation ($USD486.06K) is about average for companies of similar size in the NZ market ($USD536.77K).

Compensation vs Earnings: Insufficient data to compare Blair's compensation with company performance.


Leadership Team

Experienced Management: TWR's management team is not considered experienced ( 1.2 years average tenure), which suggests a new team.


Board Members

Experienced Board: TWR's board of directors are considered experienced (7.5 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

Tower Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Tower Limited
  • Ticker: TWR
  • Exchange: NZSE
  • Founded: 1869
  • Industry: Property and Casualty Insurance
  • Sector: Insurance
  • Market Cap: NZ$269.854m
  • Shares outstanding: 421.65m
  • Website: https://www.tower.co.nz

Location

  • Tower Limited
  • 136 Fanshawe Street
  • Level 5
  • Auckland
  • 1010
  • New Zealand

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/26 06:02
End of Day Share Price2021/10/26 00:00
Earnings2021/03/31
Annual Earnings2020/09/30


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.