Turners Automotive Group (NZSE:TRA) - Share price, News & Analysis

Q: What is the Fair Price of TRA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

TRA (NZ$3.63) is trading below our estimate of [[fair value]] (NZ$5.14)

TRA fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	1/6
Past Performance	5/6
Financial Health	2/6
Dividends	3/6

TRA Stock Overview

Turners Automotive Group Limited engages in the automotive retail business in New Zealand.

Rewards

Trading at 29.3% below our estimate of its fair value

Earnings are forecast to grow 5.59% per year

Earnings grew by 16.4% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Dividend of 6.61% is not well covered by earnings

Turners Automotive Group Competitors

Colonial Motor

NZSE:CMO

NZ$310.9m

NZ Automotive Investments

NZSE:NZA

NZ$31.4m

Hallenstein Glasson Holdings

NZSE:HLG

NZ$325.8m

KMD Brands

NZSE:KMD

NZ$787.0m

Price History & Performance

Summary of all time highs, changes and price drops for Turners Automotive Group
Historical stock prices
Current Share Price	NZ$3.63
52 Week High	NZ$4.61
52 Week Low	NZ$3.46
Beta	1.03
1 Month Change	-4.47%
3 Month Change	-11.68%
1 Year Change	-19.51%
3 Year Change	55.13%
5 Year Change	1.68%
Change since IPO	21.00%

Recent News & Updates

Jun 09

Turners Automotive Group (NZSE:TRA) Has Announced That It Will Be Increasing Its Dividend To NZ$0.082

Turners Automotive Group Limited ( NZSE:TRA ) will increase its dividend on the 28th of July to NZ$0.082. This will...

Shareholder Returns

	TRA	NZ Specialty Retail	NZ Market
7D	0.8%	2.8%	2.9%
1Y	-19.5%	-17.6%	-16.5%

Return vs Industry: TRA underperformed the NZ Specialty Retail industry which returned -17.6% over the past year.

Return vs Market: TRA underperformed the NZ Market which returned -16.5% over the past year.

Price Volatility

Is TRA's price volatile compared to industry and market?
TRA volatility
TRA Average Weekly Movement	2.9%
Specialty Retail Industry Average Movement	4.4%
Market Average Movement	4.4%
10% most volatile stocks in NZ Market	8.8%
10% least volatile stocks in NZ Market	3.0%

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

Volatility Over Time: TRA's weekly volatility (3%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1984	700	Todd Hunter	https://www.turnersautogroup.co.nz

Turners Automotive Group Limited engages in the automotive retail business in New Zealand. It operates through: Automotive Retail, Finance, Credit Management, and Insurance segments. The Automotive retail segment engages in the purchasing and selling of vehicles.

Turners Automotive Group Fundamentals Summary

How do Turners Automotive Group's earnings and revenue compare to its market cap?
TRA fundamental statistics
Market Cap	NZ$312.43m
Earnings (TTM)	NZ$31.28m
Revenue (TTM)	NZ$342.58m

10.0x

P/E Ratio

0.9x

P/S Ratio

Is TRA overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
TRA income statement (TTM)
Revenue	NZ$342.58m
Cost of Revenue	NZ$167.22m
Gross Profit	NZ$129.62m
Other Expenses	NZ$98.33m
Earnings	NZ$31.28m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	0.36
Gross Margin	37.84%
Net Profit Margin	9.13%
Debt/Equity Ratio	163.5%

How did TRA perform over the long term?

See historical performance and comparison

Dividends

6.6%

Current Dividend Yield

66%

Payout Ratio

Does TRA pay a reliable dividends?

See TRA dividend history and benchmarks

When do you need to buy TRA by to receive an upcoming dividend?
Turners Automotive Group dividend dates
Ex Dividend Date	Jul 18 2022
Dividend Pay Date	Jul 28 2022
Days until Ex dividend	18 days
Days until Dividend pay date	28 days

Does TRA pay a reliable dividends?

See TRA dividend history and benchmarks

We’ve recently updated our valuation analysis.

Valuation

Is TRA undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TRA?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for TRA. This is calculated by dividing TRA's market cap by their current preferred multiple.
What is TRA's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	NZ$312.43m

TRA key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2x
Enterprise Value/EBITDA	11.5x
PEG Ratio	1.8x

Price to Earnings Ratio vs Peers

How does TRA's PE Ratio compare to its peers?

TRA PE Ratio vs Peers

The above table shows the PE ratio for TRA vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	14.4x
CMO Colonial Motor	10.3x	n/a	NZ$310.9m
NZA NZ Automotive Investments	12.1x	n/a	NZ$31.4m
HLG Hallenstein Glasson Holdings	12.8x	n/a	NZ$325.8m
KMD KMD Brands	22.3x	34.9%	NZ$787.0m
TRA Turners Automotive Group	10x	5.6%	NZ$312.4m

Forward PE

Price-To-Earnings vs Peers: TRA is good value based on its Price-To-Earnings Ratio (10x) compared to the peer average (14.4x).

Price to Earnings Ratio vs Industry

How does TRA's PE Ratio compare vs other companies in the Oceanian Specialty Retail Industry?

Price-To-Earnings vs Industry: TRA is good value based on its Price-To-Earnings Ratio (10x) compared to the NZ Specialty Retail industry average (12.9x)

Price to Earnings Ratio vs Fair Ratio

What is TRA's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TRA PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	10x
Fair PE Ratio	9.7x

Price-To-Earnings vs Fair Ratio: TRA is expensive based on its Price-To-Earnings Ratio (10x) compared to the estimated Fair Price-To-Earnings Ratio (9.7x).

Share Price vs Fair Value

What is the Fair Price of TRA when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TRA (NZ$3.63) is trading below our estimate of fair value (NZ$5.14)

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

Price to Earnings Growth Ratio

PEG Ratio: TRA is poor value based on its PEG Ratio (1.8x)

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Future Growth

How is Turners Automotive Group forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

5.6%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: TRA's forecast earnings growth (5.6% per year) is above the savings rate (2%).

Earnings vs Market: TRA's earnings (5.6% per year) are forecast to grow slower than the NZ market (6.7% per year).

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

Revenue vs Market: TRA's revenue (5.3% per year) is forecast to grow slower than the NZ market (6.6% per year).

High Growth Revenue: TRA's revenue (5.3% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: TRA's Return on Equity is forecast to be low in 3 years time (13.1%).

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Past Performance

How has Turners Automotive Group performed over the past 5 years?

Past Performance Score

5/6

Past Performance Score 5/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

8.6%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: TRA has high quality earnings.

Growing Profit Margin: TRA's current net profit margins (9.1%) are higher than last year (9.1%).

Past Earnings Growth Analysis

Earnings Trend: TRA's earnings have grown by 8.6% per year over the past 5 years.

Accelerating Growth: TRA's earnings growth over the past year (16.4%) exceeds its 5-year average (8.6% per year).

Earnings vs Industry: TRA earnings growth over the past year (16.4%) exceeded the Specialty Retail industry 13.7%.

Return on Equity

High ROE: TRA's Return on Equity (12.4%) is considered low.

Discover strong past performing companies

Financial Health

How is Turners Automotive Group's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: TRA's short term assets (NZ$561.0M) exceed its short term liabilities (NZ$4.0M).

Long Term Liabilities: TRA's short term assets (NZ$561.0M) do not cover its long term liabilities (NZ$569.3M).

Debt to Equity History and Analysis

Debt Level: TRA's net debt to equity ratio (130.3%) is considered high.

Reducing Debt: TRA's debt to equity ratio has increased from 154.8% to 163.5% over the past 5 years.

Debt Coverage: TRA's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: TRA's interest payments on its debt are well covered by EBIT (10.4x coverage).

Balance Sheet

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Dividend

What is Turners Automotive Group current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

6.61%

Current Dividend Yield

Upcoming Dividend Payment

Dividend Yield vs Market

Notable Dividend: TRA's dividend (6.61%) is higher than the bottom 25% of dividend payers in the NZ market (3.01%).

High Dividend: TRA's dividend (6.61%) is in the top 25% of dividend payers in the NZ market (6.11%)

Stability and Growth of Payments

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

Growing Dividend: TRA's dividend payments have increased, but the company has only paid a dividend for 8 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonable payout ratio (66%), TRA's dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: TRA is paying a dividend but the company has no free cash flows.

Discover strong dividend paying companies

Management

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

5.4yrs

Average management tenure

CEO

Todd Hunter

6yrs

Tenure

Mr. Todd William Hunter serves as Group Chief Executive Officer at Turners Automotive Group Limited. He serves as Non-Executive Director of Carly Holdings Limited (formerly known as Collaborate Corporation...

Leadership Team

Experienced Management: TRA's management team is seasoned and experienced (5.4 years average tenure).

Board Members

Experienced Board: TRA's board of directors are considered experienced (7.2 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.

Data	Last Updated (UTC time)
Company Analysis	2022/06/29 00:00
End of Day Share Price	2022/06/29 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31