NYSE:DAVA

Stock Analysis Report

Executive Summary

Endava plc provides technology services for clients in the consumer products, healthcare, logistics, and retail verticals in Europe, Latin America, and the United States.

Rewards

Earnings are forecast to grow 57.23% per year

Risk Analysis

Profit margins (4.8%) are lower than last year (7.2%)

Shareholders have been diluted in the past year



Snowflake Analysis

Exceptional growth potential with flawless balance sheet.


Similar Companies

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

10.5%

DAVA

2.1%

US IT

0.06%

US Market


1 Year Return

115.7%

DAVA

37.4%

US IT

19.4%

US Market

Return vs Industry: DAVA exceeded the US IT industry which returned 37.4% over the past year.

Return vs Market: DAVA exceeded the US Market which returned 19.4% over the past year.


Shareholder returns

DAVAIndustryMarket
7 Day10.5%2.1%0.06%
30 Day16.5%4.6%1.1%
90 Day17.6%14.9%8.9%
1 Year115.7%115.7%38.8%37.4%21.9%19.4%
3 Yearn/a111.5%102.4%48.9%39.3%
5 Yearn/a147.5%125.5%71.9%53.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

140.17x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: DAVA ($53.39) is trading above our estimate of fair value ($31.35)

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


Price To Earnings Ratio

PE vs Industry: DAVA is poor value based on its PE Ratio (140.2x) compared to the IT industry average (33.1x).

PE vs Market: DAVA is poor value based on its PE Ratio (140.2x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: DAVA is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: DAVA is overvalued based on its PB Ratio (11.5x) compared to the US IT industry average (4.3x).


Next Steps

Future Growth

How is Endava forecast to perform in the next 1 to 3 years based on estimates from 8 analysts?

57.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DAVA's forecast earnings growth (57.2% per year) is above the savings rate (1.7%).

Earnings vs Market: DAVA's earnings (57.2% per year) are forecast to grow faster than the US market (14.2% per year).

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

Revenue vs Market: DAVA's revenue (20.3% per year) is forecast to grow faster than the US market (7.6% per year).

High Growth Revenue: DAVA's revenue (20.3% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DAVA's Return on Equity is forecast to be high in 3 years time (21.9%)


Next Steps

Past Performance

How has Endava performed over the past 5 years?

11.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DAVA has high quality earnings.

Growing Profit Margin: DAVA's current net profit margins (4.8%) are lower than last year (7.2%).


Past Earnings Growth Analysis

Earnings Trend: DAVA's earnings have grown by 11.8% per year over the past 5 years.

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

Earnings vs Industry: DAVA had negative earnings growth (-18%) over the past year, making it difficult to compare to the IT industry average (12%).


Return on Equity

High ROE: DAVA's Return on Equity (8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Endava's financial position?


Financial Position Analysis

Short Term Liabilities: DAVA's short term assets (£158.0M) exceed its short term liabilities (£87.8M).

Long Term Liabilities: DAVA's short term assets (£158.0M) exceed its long term liabilities (£44.4M).


Debt to Equity History and Analysis

Debt Level: DAVA is debt free.

Reducing Debt: DAVA has no debt compared to 5 years ago when its debt to equity ratio was 9.1%.

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

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


Balance Sheet

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

Debt Coverage by Assets: Insufficient data to determine if DAVA's debt is covered by short term assets.


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage1.2%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate DAVA's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate DAVA's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if DAVA's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if DAVA's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of DAVA's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

3.6yrs

Average management tenure


CEO

John Cotterell (58yo)

20yrs

Tenure

UK£3,088,000

Compensation

Mr. John E. Cotterell serves as the Chief Executive of Endava (UK) Limited and at Endava plc since February 2000. Mr. Cotterell served as the Managing Director at Alexander Mann Group Limited. He served as ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD4.02M) is about average for companies of similar size in the US market ($USD4.89M).

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


Leadership Team

NamePositionTenureCompensationOwnership
John Cotterell
CEO & Director20yrsUK£3.09m18.8% £527.1m
Mark Thurston
CFO & Director4.8yrsUK£2.43m0.17% £4.9m
Rob Machin
Chief Operating Officer2.6yrsno data0.80% £22.5m
Laurence Madsen
Investor Relations Manager1.6yrsno datano data
Rohit Bhoothalingam
General Counsel0.9yrsno datano data
Julian Bull
Chief Commercial Officer3.6yrsno data1.65% £46.2m
Simon Whittington
Managing Director for US10.1yrsno data0.57% £16.0m
Toby Dixon
Managing Director of Germany3.8yrsno datano data
Michael Greenberg
Executive VP of North America & Global BFSI Lead1.6yrsno datano data
Justin Marcucci
Chief Digital Officer0yrsno data0.48% £13.4m

3.6yrs

Average Tenure

49yo

Average Age

Experienced Management: DAVA's management team is considered experienced (3.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
John Cotterell
CEO & Director20yrsUK£3.09m18.8% £527.1m
Mark Thurston
CFO & Director4.8yrsUK£2.43m0.17% £4.9m
Michael Kinton
Independent Director13.8yrsUK£219.00k3.39% £94.9m
Andrew Allan
Independent Director13.8yrsUK£219.00k1.23% £34.4m
Sulina Connal
Independent Director0.4yrsno datano data
Ben Druskin
Independent Director2.4yrsUK£219.00k0.070% £2.0m
David Pattillo
Independent Director3.1yrsUK£226.00k0.041% £1.1m
Trevor Smith
Independent Chairman of the Board3.6yrsUK£224.00k0.12% £3.4m

4.2yrs

Average Tenure

58.5yo

Average Age

Experienced Board: DAVA's board of directors are considered experienced (4.2 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.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 10.9%.


Top Shareholders

Company Information

Endava plc's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Endava plc
  • Ticker: DAVA
  • Exchange: NYSE
  • Founded: 2000
  • Industry: IT Consulting and Other Services
  • Sector: Software
  • Market Cap: US$2.804b
  • Shares outstanding: 52.52m
  • Website: https://www.endava.com

Number of Employees


Location

  • Endava plc
  • 125 Old Broad Street
  • London
  • Greater London
  • EC2N 1AR
  • United Kingdom

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DAVANYSE (New York Stock Exchange)YesSPON ADS EACH REP 1 ORD SHS CL AUSUSDJul 2018
2Y5DB (Deutsche Boerse AG)YesSPON ADS EACH REP 1 ORD SHS CL ADEEURJul 2018
DAVA NBMV (Bolsa Mexicana de Valores)YesSPON ADS EACH REP 1 ORD SHS CL AMXMXNJul 2018

Biography

Endava plc provides technology services for clients in the consumer products, healthcare, logistics, and retail verticals in Europe, Latin America, and the United States. It offers strategy, creative and user experience, insights through data, mobile and Internet of Things, architecture, smart automation, software engineering, test automation and engineering, continuous delivery, cloud, applications management, and smart desk services across the digital evolution, agile transformation, and automation solution areas. The company was founded in 2000 and is headquartered in London, United Kingdom. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/19 01:55
End of Day Share Price2020/02/18 00:00
Earnings2019/12/31
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.