ENXTLS:CTT

Stock Analysis Report

CTT - Correios De Portugal

Executive Summary

CTT - Correios De Portugal, S.A., together with its subsidiaries, provides postal and financial services worldwide.

Rewards

Trading at 56.6% below its fair value

Earnings are forecast to grow 16.25% per year

Earnings grew by 61.6% over the past year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Large one-off items impacting financial results



Snowflake Analysis

Undervalued with moderate growth potential.


Similar Companies

Share Price & News

How has CTT - Correios De Portugal's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

-3.5%

CTT

0.6%

PT Logistics

1.7%

PT Market


1 Year Return

-8.1%

CTT

21.2%

PT Logistics

14.3%

PT Market

Return vs Industry: CTT underperformed the Portuguese Logistics industry which returned 21.2% over the past year.

Return vs Market: CTT underperformed the Portuguese Market which returned 14.3% over the past year.


Shareholder returns

CTTIndustryMarket
7 Day-3.5%0.6%1.7%
30 Day-12.9%-2.1%3.8%
90 Day-10.0%-1.4%6.5%
1 Year-3.8%-8.1%24.9%21.2%19.4%14.3%
3 Year-28.1%-44.4%26.0%14.4%39.1%22.7%
5 Year-56.7%-70.0%44.3%22.9%23.9%-51.3%

Price Volatility Vs. Market

How volatile is CTT - Correios De Portugal's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is CTT - Correios De Portugal 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: CTT (€2.83) is trading below our estimate of fair value (€6.52)

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


Price To Earnings Ratio

PE vs Industry: CTT is good value based on its PE Ratio (13.7x) compared to the Logistics industry average (16.2x).

PE vs Market: CTT is good value based on its PE Ratio (13.7x) compared to the Portuguese market (15.1x).


Price to Earnings Growth Ratio

PEG Ratio: CTT is good value based on its PEG Ratio (0.8x)


Price to Book Ratio

PB vs Industry: CTT is overvalued based on its PB Ratio (3x) compared to the XE Logistics industry average (2.5x).


Next Steps

Future Growth

How is CTT - Correios De Portugal forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

16.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CTT's forecast earnings growth (16.3% per year) is above the savings rate (0.4%).

Earnings vs Market: CTT's earnings (16.3% per year) are forecast to grow faster than the Portuguese market (6.2% per year).

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

Revenue vs Market: CTT's revenue (1.2% per year) is forecast to grow slower than the Portuguese market (2.5% per year).

High Growth Revenue: CTT's revenue (1.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CTT's Return on Equity is forecast to be high in 3 years time (25.5%)


Next Steps

Past Performance

How has CTT - Correios De Portugal performed over the past 5 years?

-29.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CTT has a large one-off loss of €26.4M impacting its September 30 2019 financial results.

Growing Profit Margin: CTT's current net profit margins (4.3%) are higher than last year (2.8%).


Past Earnings Growth Analysis

Earnings Trend: CTT's earnings have declined by -29.7% per year over the past 5 years.

Accelerating Growth: CTT's earnings growth over the past year (61.6%) exceeds its 5-year average (-29.7% per year).

Earnings vs Industry: CTT earnings growth over the past year (61.6%) exceeded the Logistics industry 12.8%.


Return on Equity

High ROE: Whilst CTT's Return on Equity (21.62%) is high, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is CTT - Correios De Portugal's financial position?


Financial Position Analysis

Short Term Liabilities: CTT's short term assets (€728.4M) do not cover its short term liabilities (€1.7B).

Long Term Liabilities: CTT's short term assets (€728.4M) exceed its long term liabilities (€499.0M).


Debt to Equity History and Analysis

Debt Level: CTT's debt to equity ratio (121.9%) is considered high.

Reducing Debt: CTT's debt to equity ratio has increased from 1.7% to 121.9% over the past 5 years.

Debt Coverage: CTT's debt is well covered by operating cash flow (86.1%).

Interest Coverage: CTT's interest payments on its debt are well covered by EBIT (67.3x coverage).


Balance Sheet

Inventory Level: CTT has a low level of unsold assets or inventory.

Debt Coverage by Assets: CTT's debt is covered by short term assets (assets are 4.2x debt).


Next Steps

Dividend

What is CTT - Correios De Portugal's current dividend yield, its reliability and sustainability?

3.53%

Current Dividend Yield


Dividend Yield vs Market

company3.5%marketbottom25%2.8%markettop25%7.5%industryaverage2.9%forecastin3Years6.2%

Current dividend yield vs market & industry

Notable Dividend: CTT's dividend (3.53%) is higher than the bottom 25% of dividend payers in the Portuguese market (2.76%).

High Dividend: CTT's dividend (3.53%) is low compared to the top 25% of dividend payers in the Portuguese market (7.49%).


Stability and Growth of Payments

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

Growing Dividend: CTT has only been paying a dividend for 6 years, and since then payments have fallen.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (48.3%), CTT's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CTT's dividends in 3 years are forecast to be covered by earnings (60.9% payout ratio).


Next Steps

Management

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

3.2yrs

Average board tenure


CEO

João Afonso Ramalho Sopas Bento (59yo)

€55,250

Compensation

Prof. João Afonso Ramalho Sopas Pereira Bento serves as the Chief Executive Officer of Efacec Capital, S.G.P.S., SA. Prof. Bento served as Head of Companhia de Concessoes Rodoviarias and Head of Elos - Lig ...


Board Members

NamePositionTenureCompensationOwnership
João Afonso Ramalho Sopas Bento
Executive Director & CEO0yrs€55.25k0.013% 56.6k
Guy Patrick Guimarães de Pacheco
CFO & Executive Director2.2yrs€416.41k0.0040% 17.0k
Francisco Maria da de Sousa de Macedo Simão
COO, CTO & Executive Director2.8yrs€376.14kno data
Dionizia Ribeiro Farinha Ferreira
CCO of Corporate & Executive Director7.5yrs€376.20k0.029% 121.3k
António Ferreira Vaz da Silva
CCO of Retail & Executive Director2.8yrs€376.16k0.0023% 9.9k
José Manuel Fino
Non-Executive Director5.2yrs€46.29kno data
António Sarmento Mota
Non-Executive Chairman & Lead Independent Director6.1yrs€262.50kno data
Céline Dora Abecassis-Moedas
Non-Executive Director3.5yrsno datano data
Nuno De Carvalho Thomaz
Non Executive Director5.9yrs€63.75kno data
Maria Luísa Coutinho Ferreira Leite Castro Anacoreta Correia
Non-Executive Director2.8yrs€76.50kno data

3.2yrs

Average Tenure

53yo

Average Age

Experienced Board: CTT's board of directors are considered experienced (3.2 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.


Top Shareholders

Company Information

CTT - Correios De Portugal, S.A.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: CTT - Correios De Portugal, S.A.
  • Ticker: CTT
  • Exchange: ENXTLS
  • Founded: 1520
  • Industry: Air Freight and Logistics
  • Sector: Transportation
  • Market Cap: €424.800m
  • Shares outstanding: 150.00m
  • Website: https://www.ctt.pt

Number of Employees


Location

  • CTT - Correios De Portugal, S.A.
  • Avenida D. João II, no. 13
  • Lisbon
  • Lisbon
  • 1999-001
  • Portugal

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CTTENXTLS (Euronext Lisbon)YesOrdinary SharesPTEURDec 2013
CTTUBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBEURDec 2013
C7TDB (Deutsche Boerse AG)YesOrdinary SharesDEEURDec 2013
0QIMLSE (London Stock Exchange)YesOrdinary SharesGBEURDec 2013
CTT NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNDec 2013
CTTO.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDDec 2013
CTTP.YOTCPK (Pink Sheets LLC)ADRUSUSDJan 2015

Biography

CTT - Correios De Portugal, S.A., together with its subsidiaries, provides postal and financial services worldwide. The company operates through Mail, Express & Parcels, Financial Services, and Banco CTT segments. It offers courier, urgent mail, and merchandise services; banking services; services related with the distribution of advertising mail; and physical and hybrid mail production, as well as electronic document management services. The company also provides transport solutions in the road haulage market; and services related to the information and communication technologies, such as invoice processing and digital receipts. In addition, it enables the payment of various services and utilities through a network of approximately 4,000 agents covering business outlets as stationery stores, tobacco shops, kiosks, and supermarkets. The company operates a retail network of 2,369 contact points with 608 post offices; 1,761 postal agencies; and 1,899 stamp sale points, as well as 175 automatic stamp vending machines and 14 automatic postal product vending machines. It also operates a sorting network of 3 production and logistics centers, 7 logistics and delivery centers, and 1 business mail center; a transport network with 244 vehicles; and 235 postal delivery offices, including 60 delivery support offices, as well as 2 delivery support services. The company was formerly known as Correio Publico. CTT - Correios De Portugal, S.A. was founded in 1520 and is headquartered in Lisbon, Portugal. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/16 22:05
End of Day Share Price2020/02/14 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.