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Serko

NZSE:SKO
Snowflake Description

Flawless balance sheet with high growth potential.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
SKO
NZSE
NZ$302M
Market Cap
  1. Home
  2. NZ
  3. Software
Company description

Serko Limited, together with its subsidiaries, provides computer software solutions for the management and administration of corporate travel bookings in New Zealand, Australia, India, Singapore, the United States, and internationally. The last earnings update was 157 days ago. More info.


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SKO Share Price and Events
7 Day Returns
2.2%
NZSE:SKO
-0%
NZ Software
1.1%
NZ Market
1 Year Returns
53.1%
NZSE:SKO
25%
NZ Software
14%
NZ Market
SKO Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Serko (SKO) 2.2% 17.1% 13.9% 53.1% 350% -
NZ Software -0% 13.6% 12% 25% 78.6% 106.4%
NZ Market 1.1% 4.4% 7.5% 14% 26.7% 48.3%
1 Year Return vs Industry and Market
  • SKO outperformed the Software industry which returned 25% over the past year.
  • SKO outperformed the Market in New Zealand which returned 14% over the past year.
Price Volatility
SKO
Industry
5yr Volatility vs Market

Value

 Is Serko undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Serko to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Serko.

NZSE:SKO Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 2 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 8.9%
Perpetual Growth Rate 10-Year NZ Government Bond Rate 2.4%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NZSE:SKO
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year NZ Govt Bond Rate 2.4%
Equity Risk Premium S&P Global 6%
Software Unlevered Beta Simply Wall St/ S&P Global 1.14
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.141 (1 + (1- 28%) (0.08%))
1.095
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.09
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.37% + (1.095 * 5.96%)
8.9%

Discounted Cash Flow Calculation for NZSE:SKO using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Serko is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

NZSE:SKO DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (NZD, Millions) Source Present Value
Discounted (@ 8.9%)
2019 2.00 Analyst x1 1.84
2020 6.00 Analyst x1 5.06
2021 9.00 Analyst x1 6.97
2022 11.59 Est @ 28.73% 8.24
2023 14.00 Est @ 20.82% 9.14
2024 16.14 Est @ 15.29% 9.68
2025 17.98 Est @ 11.41% 9.90
2026 19.54 Est @ 8.7% 9.88
2027 20.87 Est @ 6.8% 9.69
2028 22.01 Est @ 5.47% 9.39
Present value of next 10 years cash flows NZ$79.79
NZSE:SKO DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2028 × (1 + g) ÷ (Discount Rate – g)
= NZ$22.01 × (1 + 2.37%) ÷ (8.9% – 2.37%)
NZ$345.34
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= NZ$345.34 ÷ (1 + 8.9%)10
NZ$147.28
NZSE:SKO Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= NZ$79.79 + NZ$147.28
NZ$227.07
Equity Value per Share
(NZD)
= Total value / Shares Outstanding
= NZ$227.07 / 80.92
NZ$2.81
NZSE:SKO Discount to Share Price
Calculation Result
Value per share (NZD) From above. NZ$2.81
Current discount Discount to share price of NZ$3.69
= -1 x (NZ$3.69 - NZ$2.81) / NZ$2.81
-31.5%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Serko is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Serko's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Serko's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NZSE:SKO PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-09-30) in NZD NZ$0.02
NZSE:SKO Share Price ** NZSE (2019-04-26) in NZD NZ$3.69
Oceania Software Industry PE Ratio Median Figure of 22 Publicly-Listed Software Companies 37.56x
New Zealand Market PE Ratio Median Figure of 90 Publicly-Listed Companies 17.98x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Serko.

NZSE:SKO PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NZSE:SKO Share Price ÷ EPS (both in NZD)

= 3.69 ÷ 0.02

161.88x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Serko is overvalued based on earnings compared to the Oceania Software industry average.
  • Serko is overvalued based on earnings compared to the New Zealand market.
Price based on expected Growth
Does Serko's expected growth come at a high price?
Raw Data
NZSE:SKO PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 161.88x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts
49.5%per year
Oceania Software Industry PEG Ratio Median Figure of 16 Publicly-Listed Software Companies 2.78x
New Zealand Market PEG Ratio Median Figure of 66 Publicly-Listed Companies 1.5x

*Line of best fit is calculated by linear regression .

NZSE:SKO PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 161.88x ÷ 49.5%

3.27x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Serko is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Serko's assets?
Raw Data
NZSE:SKO PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-09-30) in NZD NZ$0.30
NZSE:SKO Share Price * NZSE (2019-04-26) in NZD NZ$3.69
New Zealand Software Industry PB Ratio Median Figure of 10 Publicly-Listed Software Companies 3.96x
New Zealand Market PB Ratio Median Figure of 126 Publicly-Listed Companies 1.57x
NZSE:SKO PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NZSE:SKO Share Price ÷ Book Value per Share (both in NZD)

= 3.69 ÷ 0.30

12.45x

* Primary Listing of Serko.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Serko is overvalued based on assets compared to the NZ Software industry average.
X
Value checks
We assess Serko's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Software industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Software industry average (and greater than 0)? (1 check)
  5. Serko has a total score of 0/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

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

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
49.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Serko expected to grow at an attractive rate?
  • Serko's earnings growth is expected to exceed the low risk savings rate of 2.4%.
Growth vs Market Checks
  • Serko's earnings growth is expected to exceed the New Zealand market average.
  • Serko's revenue growth is expected to exceed the New Zealand market average.
Annual Growth Rates Comparison
Raw Data
NZSE:SKO Future Growth Rates Data Sources
Data Point Source Value (per year)
NZSE:SKO Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 2 Analysts 49.5%
NZSE:SKO Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 2 Analysts 27.6%
New Zealand Software Industry Earnings Growth Rate Market Cap Weighted Average 46%
Oceania Software Industry Revenue Growth Rate Market Cap Weighted Average 18.1%
New Zealand Market Earnings Growth Rate Market Cap Weighted Average 6.2%
New Zealand Market Revenue Growth Rate Market Cap Weighted Average 5%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NZSE:SKO Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
All numbers in NZD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NZSE:SKO Future Estimates Data
Date (Data in NZD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2021-03-31 41 8 5 2
2020-03-31 32 5 4 2
2019-03-31 25 3 2 2
NZSE:SKO Past Financials Data
Date (Data in NZD Millions) Revenue Cash Flow Net Income *
2018-09-30 21 3 2
2018-06-30 19 2 2
2018-03-31 18 1 2
2017-12-31 17 1 1
2017-09-30 16 1 0
2017-06-30 15 0 -2
2017-03-31 14 -2 -3
2016-12-31 14 -3 -4
2016-09-30 14 -5 -5
2016-06-30 13 -5 -6
2016-03-31 13 -4 -6
2015-12-31 13 -5 -6

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Serko's earnings are expected to grow significantly at over 20% yearly.
  • Serko's revenue is expected to grow significantly at over 20% yearly.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NZSE:SKO Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below

All data from Serko Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NZSE:SKO Future Estimates Data
Date (Data in NZD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2021-03-31 0.08 0.08 0.08 1.00
2020-03-31 0.06 0.06 0.06 1.00
2019-03-31 0.02 0.02 0.02 1.00
NZSE:SKO Past Financials Data
Date (Data in NZD Millions) EPS *
2018-09-30 0.02
2018-06-30 0.02
2018-03-31 0.03
2017-12-31 0.01
2017-09-30 0.00
2017-06-30 -0.03
2017-03-31 -0.05
2016-12-31 -0.06
2016-09-30 -0.07
2016-06-30 -0.08
2016-03-31 -0.10
2015-12-31 -0.10

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Serko is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Serko's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the New Zealand market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Oceania market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Serko has a total score of 5/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Serko performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Serko's growth in the last year to its industry (Software).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Serko has delivered over 20% year on year earnings growth in the past 5 years.
  • Serko has become profitable in the last year making the earnings growth rate difficult to compare to the 5-year average.
  • Serko has become profitable in the last year making it difficult to compare the Oceania Software industry average.
Earnings and Revenue History
Serko's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Serko Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NZSE:SKO Past Revenue, Cash Flow and Net Income Data
Date (Data in NZD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-09-30 20.56 1.66 6.25
2018-06-30 19.42 1.74 5.60
2018-03-31 18.28 1.83 4.95
2017-12-31 17.31 0.77 5.07
2017-09-30 16.34 -0.29 5.20
2017-06-30 15.31 -1.87 5.37
2017-03-31 14.28 -3.45 5.54
2016-12-31 14.00 -4.18 5.52
2016-09-30 13.73 -4.90 5.50
2016-06-30 13.43 -5.57 5.58
2016-03-31 13.12 -6.23 5.67
2015-12-31 12.57 -6.29 5.55
2015-09-30 12.02 -6.35 5.43
2015-06-30 11.19 -6.45 5.55
2015-03-31 10.36 -6.55 5.68
2014-12-31 9.31 -5.77 5.07
2014-09-30 8.25 -4.99 4.45
2014-06-30 7.47 -3.36 3.50
2014-03-31 6.68 -1.74 2.54
2013-12-31 6.11 -1.20 3.01
2013-09-30 5.53 -0.65 3.47
2013-06-30 5.17 -0.50 3.84
2013-03-31 4.81 -0.34 4.21

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Serko has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Serko used its assets less efficiently than the Oceania Software industry average last year based on Return on Assets.
  • Serko has become profitable over the past 3 years. This is considered to be a significant improvement in its use of capital (Return on Capital Employed).
X
Past performance checks
We assess Serko's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Software industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Serko has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Serko's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Serko's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Serko is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Serko's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Serko's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • Low level of unsold assets.
  • Debt is covered by short term assets, assets are 101.4x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Serko Company Filings, last reported 6 months ago.

NZSE:SKO Past Debt and Equity Data
Date (Data in NZD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-09-30 23.81 0.23 18.97
2018-06-30 23.81 0.23 18.97
2018-03-31 8.34 0.56 5.23
2017-12-31 8.34 0.56 5.23
2017-09-30 7.43 0.69 4.56
2017-06-30 7.43 0.69 4.56
2017-03-31 6.28 0.65 4.45
2016-12-31 6.28 0.65 4.45
2016-09-30 7.61 0.70 4.77
2016-06-30 7.61 0.70 4.77
2016-03-31 9.73 0.34 7.12
2015-12-31 9.73 0.34 7.12
2015-09-30 4.72 0.38 2.48
2015-06-30 4.72 0.38 2.48
2015-03-31 7.91 0.32 4.49
2014-12-31 7.91 0.32 4.49
2014-09-30 11.14 0.04 8.34
2014-06-30 11.14 0.04 8.34
2014-03-31 -3.42 5.54 0.25
2013-12-31 -3.42 5.54 0.25
2013-09-30 -2.02 3.24 0.08
2013-06-30 -2.02 3.24 0.08
2013-03-31 -1.67 3.12 0.09
  • Serko's level of debt (1%) compared to net worth is satisfactory (less than 40%).
  • Serko had negative shareholder equity 5 years ago, it is now positive therefore their debt level has improved.
  • Debt is well covered by operating cash flow (1187.3%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 7.1x coverage).
X
Financial health checks
We assess Serko's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Serko has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

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

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0%
Current annual income from Serko dividends.
If you bought NZ$2,000 of Serko shares you are expected to receive NZ$0 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Unable to evaluate Serko's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.
  • Unable to evaluate Serko's dividend against the top 25% market benchmark as the company has not reported any payouts.
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NZSE:SKO Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 2 Analyst Estimates (S&P Global) See Below
Oceania Software Industry Average Dividend Yield Market Cap Weighted Average of 15 Stocks 1.2%
New Zealand Market Average Dividend Yield Market Cap Weighted Average of 75 Stocks 3.8%
New Zealand Minimum Threshold Dividend Yield 10th Percentile 1.9%
New Zealand Bottom 25% Dividend Yield 25th Percentile 3.3%
New Zealand Top 25% Dividend Yield 75th Percentile 5.5%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NZSE:SKO Future Dividends Estimate Data
Date (Data in NZ$) Dividend per Share (annual) Avg. No. Analysts
2021-03-31
2020-03-31
2019-03-31

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Unable to perform a dividend volatility check as Serko has not reported any payouts.
  • Unable to verify if Serko's dividend has been increasing as the company has not reported any payouts.
Current Payout to shareholders
What portion of Serko's earnings are paid to the shareholders as a dividend.
  • Unable to calculate sustainability of dividends as Serko has not reported any payouts.
Future Payout to shareholders
  • Insufficient estimate data to determine if a dividend will be paid in 3 years and that it will be sustainable.
X
Income/ dividend checks
We assess Serko's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.9%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Serko afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Serko has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

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

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Darrin Grafton
COMPENSATION NZ$439,166
CEO Bio

Mr. Darrin John Grafton, N.Z.C.D.P. is a Co-Founder of SERKO Limited and serves as its Chief Executive Officer. Mr. Grafton served as Development Manager at Serko Limited. He has 25 years of experience in the travel technology industry and is highly experienced in technology commercialization. He served as a Joint Chief Executive Officer of Interactive Technologies Ltd., a subsidiary of Gullivers Travel Group Ltd. He is recognized as an Industry Driver for client focused solutions. He is the Innovator and Leader in applying technology and TQM principals to travel management solutions. He has created travel management software available worldwide, including e-commerce applications and interface to web booking engines. He has been a Director of Serko Limited since April 5, 2007. He designed the architecture for solutions that have won six of the IT industry's international awards including Best E-Commerce Solution, Asia/Pacific region. In 2004, received a commendation award for Innovation in Technology from the New Zealand Government. He was awarded the NZX Hi-Tech Entrepreneur Award in 2007 and was a finalist for the NZ Hi-Tech Company Leader Award in 2007. In 2008 he was also a finalist for Ernst & Young Entrepreneur of the Year. He is a member of the Institute of IT Professionals NZ, the Institute of Directors NZ and NZCDP.

CEO Compensation
  • Darrin's compensation has increased in line with Serko recently becoming profitable.
  • Darrin's remuneration is higher than average for companies of similar size in New Zealand.
Management Team Tenure

Average tenure of the Serko management team in years:

2.2
Average Tenure
  • The tenure for the Serko management team is about average.
Management Team

Darrin Grafton

TITLE
Co-Founder
COMPENSATION
NZ$439K

Bob Shaw

TITLE
Co-Founder
COMPENSATION
NZ$358K

Susan Putt

TITLE
Chief Financial Officer
TENURE
2.3 yrs

Charlie Nowaczek

TITLE
Chief Operating Officer
TENURE
2.2 yrs

Michael Thorburn

TITLE
Head of Partnerships

John Challis

TITLE
Head of Business Development

Phil Ball

TITLE
Chief Information Security Officer
TENURE
1.3 yrs

Joanne Phipps

TITLE
Acting Head of Product
TENURE
5.2 yrs

Tony D'Astolfo

TITLE
Senior Vice President of NORAM
TENURE
1 yrs

Murray Warner

TITLE
Head of Australasian market
Board of Directors Tenure

Average tenure of the Serko board of directors in years:

8.5
Average Tenure
  • The tenure for the Serko board of directors is about average.
Board of Directors

Simon Botherway

TITLE
Independent Non-Executive Chairman
COMPENSATION
NZ$80K

Darrin Grafton

TITLE
Co-Founder
COMPENSATION
NZ$439K
TENURE
12 yrs

Bob Shaw

TITLE
Co-Founder
COMPENSATION
NZ$358K
TENURE
12 yrs

Claudia Batten

TITLE
Independent Non-Executive Director
COMPENSATION
NZ$74K
TENURE
5 yrs

Clyde McConaghy

TITLE
Independent Non-Executive Director
COMPENSATION
NZ$74K
AGE
56
TENURE
5 yrs
Who owns this company?
Recent Insider Trading
  • More shares have been bought than sold by Serko insiders in the past 3 months, but not in substantial volumes.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (NZ$) Value (NZ$)
08. Apr 19 Sell Harbour Asset Management Limited Company 05. Apr 19 05. Apr 19 -64,578 NZ$3.21 NZ$-207,007
08. Apr 19 Buy Harbour Asset Management Limited Company 05. Apr 19 05. Apr 19 675,651 NZ$2.84 NZ$1,921,501
08. Apr 19 Sell First NZ Capital Ltd., Asset Management Arm Company 05. Apr 19 05. Apr 19 -464,467 NZ$3.07 NZ$-1,425,355
08. Apr 19 Buy First NZ Capital Ltd., Asset Management Arm Company 05. Apr 19 05. Apr 19 552,770 NZ$3.05 NZ$1,684,925
03. Apr 19 Buy Claudia Batten Individual 02. Apr 19 02. Apr 19 1,283 NZ$3.15 NZ$4,042
03. Apr 19 Buy Simon Botherway Individual 02. Apr 19 02. Apr 19 1,283 NZ$3.15 NZ$4,041
07. Mar 19 Buy Simon Botherway Individual 05. Mar 19 05. Mar 19 1,201 NZ$3.36 NZ$4,035
07. Feb 19 Buy Simon Botherway Individual 05. Feb 19 05. Feb 19 1,246 NZ$3.25 NZ$4,017
07. Feb 19 Buy Claudia Batten Individual 05. Feb 19 05. Feb 19 1,247 NZ$3.25 NZ$4,017
10. Jan 19 Buy Simon Botherway Individual 08. Jan 19 08. Jan 19 1,483 NZ$2.75 NZ$4,078
10. Jan 19 Buy Claudia Batten Individual 08. Jan 19 08. Jan 19 1,483 NZ$2.75 NZ$4,078
15. Nov 18 Buy Simon Botherway Individual 14. Nov 18 14. Nov 18 1,195 NZ$3.25 NZ$3,872
15. Nov 18 Buy Claudia Batten Individual 14. Nov 18 14. Nov 18 1,195 NZ$3.25 NZ$3,872
16. Oct 18 Sell Harbour Asset Management Limited Company 30. Aug 18 05. Oct 18 -238,834 NZ$3.21 NZ$-765,964
16. Oct 18 Buy Harbour Asset Management Limited Company 30. Aug 18 05. Oct 18 1,162,200 NZ$3.22 NZ$3,742,706
16. Oct 18 Sell First NZ Capital Ltd., Asset Management Arm Company 30. Aug 18 05. Oct 18 -1,559,394 NZ$3.16 NZ$-4,928,261
16. Oct 18 Buy First NZ Capital Ltd., Asset Management Arm Company 30. Aug 18 05. Oct 18 1,448,536 NZ$3.16 NZ$4,577,251
10. Oct 18 Buy Simon Botherway Individual 05. Oct 18 05. Oct 18 1,167 NZ$3.43 NZ$4,001
10. Oct 18 Buy Claudia Batten Individual 05. Oct 18 05. Oct 18 1,167 NZ$3.43 NZ$4,001
12. Sep 18 Buy Claudia Batten Individual 05. Sep 18 05. Sep 18 1,422 NZ$2.90 NZ$4,125
12. Sep 18 Buy Simon Botherway Individual 05. Sep 18 05. Sep 18 1,422 NZ$2.90 NZ$4,125
09. Aug 18 Buy Simon Botherway Individual 06. Aug 18 06. Aug 18 1,452 NZ$2.84 NZ$4,125
09. Aug 18 Buy Claudia Batten Individual 06. Aug 18 06. Aug 18 1,452 NZ$2.84 NZ$4,125
11. Jul 18 Buy Claudia Batten Individual 05. Jul 18 05. Jul 18 1,368 NZ$2.97 NZ$4,063
11. Jul 18 Buy Simon Botherway Individual 05. Jul 18 05. Jul 18 1,368 NZ$2.97 NZ$4,063
X
Management checks
We assess Serko's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Serko has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Does This Valuation Of Serko Limited (NZSE:SKO) Imply Investors Are Overpaying?

I will use the Discounted Cash Flow (DCF) model. … If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model. … We're using the 2-stage growth model, which simply means we take in account two stages of company's growth

Simply Wall St -

The Serko (NZSE:SKO) Share Price Has Soared 362%, Delighting Many Shareholders

While Serko made a small profit, in the last year, we think that the market is probably more focussed on the top line growth at the moment. … In the last 3 years Serko saw its revenue grow at 18% per year. … Some shareholders might think that the share price rise of 67% per year is a lucky result, considering the level of revenue growth.

Simply Wall St -

Do Directors Own Serko Limited (NZSE:SKO) Shares?

Generally speaking, as a company grows, institutions will increase their ownership. … Taking a look at our data on the ownership groups (below), it's seems that. … We can zoom in on the different ownership groups, to learn more about SKO

Simply Wall St -

What Is Serko Limited's (NZSE:SKO) Share Price Doing?

led the NZSE gainers with a relatively large price hike in the past couple of weeks. … Less-covered, small caps tend to present more of an opportunity for mispricing due to the lack of information available to the public, which can be a good thing? … So, could the stock still be trading at a low price relative to its actual value.

Simply Wall St -

Serko Limited’s (NZSE:SKO) Investment Returns Are Lagging Its Industry

Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business. … What is Return On Capital Employed (ROCE)? … ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business.

Simply Wall St -

Does Serko Limited (NZSE:SKO) Have A Particularly Volatile Share Price?

In finance, Beta is a measure of volatility. … Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. … Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility).

Simply Wall St -

Brief Commentary On Serko Limited's (NZSE:SKO) Fundamentals

I've been keeping an eye on Serko Limited (NZSE:SKO) because I'm attracted to its fundamentals. … Looking at the company as a whole, as a potential stock investment, I believe SKO has a lot to offer. … is a company with

Simply Wall St -

What Kind Of Investor Owns Most Of Serko Limited (NZSE:SKO)?

Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. … As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.'. … With a market capitalization of NZ$264m, Serko is a small cap stock, so it might not be well known by many institutional investors.

Simply Wall St -

How Do Analysts See Serko Limited (NZSE:SKO) Performing In The Years Ahead?

Serko Limited's (NZSE:SKO) most recent earnings announcement in March 2018 … finally turned profitable

Simply Wall St -

An Examination Of Serko Limited (NZSE:SKO)

As an investor, I look for investments which does not compromise one fundamental factor for another. … By this I mean, I look at stocks holistically, from their financial health to their future outlook. … financial health as well as

Simply Wall St -

Company Info

Description

Serko Limited, together with its subsidiaries, provides computer software solutions for the management and administration of corporate travel bookings in New Zealand, Australia, India, Singapore, the United States, and internationally. It offers Serko Online, a cloud-based online travel booking solution for large organizations that provides global distribution systems (GDSs); and Serko Expense, a cloud-based expense management solution that allows users to manage cash claims, mileage, allowance, and corporate credit card expenses. The company also offers Serko mobile, a mobile app for iPhones and android devices that gives users access to information and travel booking functionality on their mobile devices. The company sells and delivers its products through a network of travel management companies. Serko Limited was founded in 1994 and is headquartered in Auckland, New Zealand. Serko Limited is a subsidiary of Gullivers Travel Group Limited.

Details
Name: Serko Limited
SKO
Exchange: NZSE
Founded: 1994
NZ$301,842,077
80,922,809
Website: http://www.serko.com
Address: Serko Limited
Saatchi & Saatchi Building,
Unit 14D,
Auckland,
1010,
New Zealand
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NZSE SKO Ordinary shares New Zealand Stock Exchange NZ NZD 24. Jun 2014
ASX SKO Ordinary shares Australian Securities Exchange AU AUD 24. Jun 2014
CHIA SKO Ordinary shares Chi-X Australia AU AUD 24. Jun 2014
Number of employees
Current staff
Staff numbers
106
Serko employees.
Industry
Application Software
Software
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/04/26 10:34
End of day share price update: 2019/04/26 00:00
Last estimates confirmation: 2019/04/09
Last earnings filing: 2018/11/20
Last earnings reported: 2018/09/30
Last annual earnings reported: 2018/03/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.