OTCPK:VETT.F

Stock Analysis Report

Executive Summary

Vector Limited, together with its subsidiaries, engages in electricity and gas distribution, natural gas and LPG sale, gas processing, metering, and telecommunication and new energy businesses in New Zealand.


Snowflake Analysis

Second-rate dividend payer and overvalued.

Share Price & News

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


Latest Share Price and Events

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


Market Performance


7 Day Return

0%

VETT.F

15.2%

US Integrated Utilities

5.3%

US Market


1 Year Return

5.8%

VETT.F

-6.3%

US Integrated Utilities

-10.7%

US Market

Return vs Industry: VETT.F exceeded the US Integrated Utilities industry which returned -6.1% over the past year.

Return vs Market: VETT.F exceeded the US Market which returned -10.4% over the past year.


Shareholder returns

VETT.FIndustryMarket
7 Day0%15.2%5.3%
30 Day0%-6.6%-13.6%
90 Dayn/a-13.2%-19.8%
1 Year5.8%5.8%-3.0%-6.3%-8.9%-10.7%
3 Yearn/a18.9%6.9%15.5%8.0%
5 Year18.1%18.1%48.0%18.2%35.2%20.4%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

39.62x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: VETT.F ($2.55) is trading above our estimate of fair value ($2.2)

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


Price To Earnings Ratio

PE vs Industry: VETT.F is poor value based on its PE Ratio (41x) compared to the Integrated Utilities industry average (19.7x).

PE vs Market: VETT.F is poor value based on its PE Ratio (41x) compared to the US market (13.1x).


Price to Earnings Growth Ratio

PEG Ratio: VETT.F is poor value based on its PEG Ratio (5.1x)


Price to Book Ratio

PB vs Industry: VETT.F is good value based on its PB Ratio (1.4x) compared to the US Integrated Utilities industry average (1.8x).


Next Steps

Future Growth

How is Vector forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

8.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VETT.F's forecast earnings growth (8% per year) is above the savings rate (1.7%).

Earnings vs Market: VETT.F's earnings (8% per year) are forecast to grow slower than the US market (12.2% per year).

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

Revenue vs Market: VETT.F's revenue (1.8% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: VETT.F's revenue (1.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VETT.F's Return on Equity is forecast to be low in 3 years time (4.8%).


Next Steps

Past Performance

How has Vector performed over the past 5 years?

4.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: VETT.F has a large one-off loss of NZ$46.6M impacting its December 31 2019 financial results.

Growing Profit Margin: VETT.F's current net profit margins (6%) are lower than last year (11.4%).


Past Earnings Growth Analysis

Earnings Trend: VETT.F's earnings have grown by 4.6% per year over the past 5 years.

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

Earnings vs Industry: VETT.F had negative earnings growth (-47.5%) over the past year, making it difficult to compare to the Integrated Utilities industry average (5.7%).


Return on Equity

High ROE: VETT.F's Return on Equity (3.4%) is considered low.


Next Steps

Financial Health

How is Vector's financial position?


Financial Position Analysis

Short Term Liabilities: VETT.F's short term assets (NZ$359.8M) do not cover its short term liabilities (NZ$951.2M).

Long Term Liabilities: VETT.F's short term assets (NZ$359.8M) do not cover its long term liabilities (NZ$2.9B).


Debt to Equity History and Analysis

Debt Level: VETT.F's debt to equity ratio (120.7%) is considered high.

Reducing Debt: VETT.F's debt to equity ratio has increased from 112.8% to 120.7% over the past 5 years.

Debt Coverage: VETT.F's debt is not well covered by operating cash flow (13.5%).

Interest Coverage: VETT.F's interest payments on its debt are not well covered by EBIT (2.5x coverage).


Balance Sheet

Inventory Level: VETT.F has a high level of physical assets or inventory.

Debt Coverage by Assets: VETT.F's debt is not covered by short term assets (assets are 0.1x debt).


Next Steps

Dividend

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

5.21%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: VETT.F's dividend (5.03%) is higher than the bottom 25% of dividend payers in the US market (1.95%).

High Dividend: VETT.F's dividend (5.03%) is low compared to the top 25% of dividend payers in the US market (5.4%).


Stability and Growth of Payments

Stable Dividend: VETT.F's dividends per share have been stable in the past 10 years.

Growing Dividend: VETT.F's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (206.2%), VETT.F's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: VETT.F's dividends in 3 years are not forecast to be well covered by earnings (131.6% payout ratio).


Next Steps

Management

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

1.0yrs

Average management tenure


CEO

Simon MacKenzie

12.08s

Tenure

Mr. Simon MacKenzie, Grad Dip BS (Dist), Dip Fin, NZCE, has been Group Chief Executive Officer of Vector Limited since February 2008 and served as Group General Manager of Strategy Regulation & Performance ...


Leadership Team

NamePositionTenureCompensationOwnership
Simon MacKenzie
Group Chief Executive Officer12.08yrsno data0.0060% NZ$113.0k
Jason Hollingworth
Chief Financial Officer0.83yrno datano data
John Rodger
General Counsel & Company Secretaryno datano datano data
Richard Llewellyn
Head of Corporate Communicationsno datano datano data
Fiona Michel
Chief People Officer1.17yrsno datano data
Richard Sharp
Head of Regulatoryno datano datano data
Nikhil Ravishankar
Chief Digital Officer3.08yrsno datano data
Brenda Talacek
Chief Operating Officer of Metering & OnGas0.17yrno datano data
Mark Toner
Chief Public Policy & Regulatory Officer0.17yrno datano data
Colin Daly
Chief Executive Officer of Vector Powersmartno datano datano data

1.0yrs

Average Tenure

Experienced Management: VETT.F's management team is not considered experienced ( 1 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Jonathan Mason
Independent Non-Executive Deputy Chairno datano data0.0019% NZ$34.9k
Alison Paterson
Independent Non-Executive Chair1.33yrsno data0.0021% NZ$39.0k
Antony Carter
Independent Non-Executive Director0.83yrno data0.0010% NZ$18.8k
Paula Rebstock
Independent Non-Executive Director0.92yrno datano data
Michael Buczkowski
Non-Independent Non-Executive Director1.33yrsno data0.00013% NZ$2.4k
Bruce Turner
Independent Non-Executive Director0.92yrno datano data
Alastair Bell
Non-Independent Non-Executive Director0.50yrno datano data

0.9yrs

Average Tenure

61yo

Average Age

Experienced Board: VETT.F's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: VETT.F 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

Vector Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Vector Limited
  • Ticker: VETT.F
  • Exchange: OTCPK
  • Founded: 1990
  • Industry: Multi-Utilities
  • Sector: Utilities
  • Market Cap: NZ$3.170b
  • Listing Market Cap: NZ$1.884b
  • Shares outstanding: 999.88m
  • Website: https://www.vector.co.nz

Number of Employees


Location

  • Vector Limited
  • 101 Carlton Gore Road
  • Newmarket
  • Auckland
  • 1023
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VCTNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDAug 2005
VETT.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDAug 2005

Biography

Vector Limited, together with its subsidiaries, engages in electricity and gas distribution, natural gas and LPG sale, gas processing, metering, and telecommunication and new energy businesses in New Zealand. It operates through three segments: Regulated Networks, Gas Trading, and Technology. The company distributes electricity to residential and commercial customers in Auckland, from Wellsford to Papakura through its network consisting of approximately 18,000 kilometers of overhead lines and underground cables; and gas to residential, commercial, and industrial customers, as well as provides bottled LPG to customers. It also provides Vector solar systems; electricity and gas metering services to approximately 1,000,000 homes and businesses; and designs, builds, and supports fiber network solutions that connect buildings in Auckland. In addition, the company offers electric vehicle app that offers update on the status of rapid chargers, and filters searches for charging stations by port type, type of charger, and availability. The company was incorporated in 1990 and is headquartered in Auckland, New Zealand. Vector Limited is a subsidiary of Entrust. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/04/01 00:18
End of Day Share Price2020/01/13 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.