JSE:DCP

Stock Analysis Report

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Executive Summary

Dis-Chem Pharmacies Limited engages in the retail and wholesale of healthcare products and pharmaceuticals in South Africa, Namibia, and Botswana.


Snowflake Analysis

Adequate balance sheet with moderate growth potential.


Similar Companies

Share Price & News

How has Dis-Chem Pharmacies's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: DCP's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

1.3%

DCP

3.4%

ZA Consumer Retailing

-0.7%

ZA Market


1 Year Return

-27.0%

DCP

-21.3%

ZA Consumer Retailing

-23.8%

ZA Market

Return vs Industry: DCP underperformed the ZA Consumer Retailing industry which returned -21.1% over the past year.

Return vs Market: DCP underperformed the ZA Market which returned -23.6% over the past year.


Shareholder returns

DCPIndustryMarket
7 Day1.3%3.4%-0.7%
30 Day-15.8%-2.3%-0.6%
90 Day-16.0%-8.8%-8.1%
1 Year-26.2%-27.0%-19.2%-21.3%-13.0%-23.8%
3 Year-31.4%-33.3%-16.6%-22.2%0.3%-18.8%
5 Yearn/a1.6%-10.5%9.9%-17.5%

Price Volatility Vs. Market

How volatile is Dis-Chem Pharmacies's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Dis-Chem Pharmacies undervalued compared to its fair value and its price relative to the market?

26.56x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: DCP (ZAR18.48) is trading above our estimate of fair value (ZAR11.24)

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


Price To Earnings Ratio

PE vs Industry: DCP is poor value based on its PE Ratio (26.6x) compared to the Consumer Retailing industry average (17.6x).

PE vs Market: DCP is poor value based on its PE Ratio (26.6x) compared to the ZA market (8x).


Price to Earnings Growth Ratio

PEG Ratio: DCP is poor value based on its PEG Ratio (1.4x)


Price to Book Ratio

PB vs Industry: DCP is overvalued based on its PB Ratio (7.1x) compared to the ZA Consumer Retailing industry average (4x).


Next Steps

Future Growth

How is Dis-Chem Pharmacies forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

18.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DCP's forecast earnings growth (18.4% per year) is above the savings rate (9.5%).

Earnings vs Market: DCP's earnings (18.4% per year) are forecast to grow slower than the ZA market (19.2% per year).

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

Revenue vs Market: DCP's revenue (10.9% per year) is forecast to grow faster than the ZA market (8.5% per year).

High Growth Revenue: DCP's revenue (10.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DCP's Return on Equity is forecast to be high in 3 years time (24.8%)


Next Steps

  • Explore growth companies in the Consumer Retailing industry.

Past Performance

How has Dis-Chem Pharmacies performed over the past 5 years?

6.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DCP has high quality earnings.

Growing Profit Margin: DCP's current net profit margins (2.5%) are lower than last year (3.4%).


Past Earnings Growth Analysis

Earnings Trend: DCP's earnings have grown by 6% per year over the past 5 years.

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

Earnings vs Industry: DCP had negative earnings growth (-18.5%) over the past year, making it difficult to compare to the Consumer Retailing industry average (6.2%).


Return on Equity

High ROE: DCP's Return on Equity (27.1%) is considered high.


Next Steps

Financial Health

How is Dis-Chem Pharmacies's financial position?


Financial Position Analysis

Short Term Liabilities: DCP's short term assets (ZAR6.8B) exceed its short term liabilities (ZAR5.2B).

Long Term Liabilities: DCP's short term assets (ZAR6.8B) exceed its long term liabilities (ZAR3.1B).


Debt to Equity History and Analysis

Debt Level: DCP's debt to equity ratio (42.1%) is considered high.

Reducing Debt: DCP's debt to equity ratio has increased from 39.3% to 42.1% over the past 5 years.

Debt Coverage: DCP's debt is well covered by operating cash flow (156.5%).

Interest Coverage: DCP's interest payments on its debt are well covered by EBIT (3.3x coverage).


Balance Sheet


Next Steps

Dividend

What is Dis-Chem Pharmacies's current dividend yield, its reliability and sustainability?

1.85%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: DCP's dividend (1.85%) isn’t notable compared to the bottom 25% of dividend payers in the ZA market (4.59%).

High Dividend: DCP's dividend (1.85%) is low compared to the top 25% of dividend payers in the ZA market (12.95%).


Stability and Growth of Payments

Stable Dividend: DCP is not paying a notable dividend for the ZA market, therefore no need to check if payments are stable.

Growing Dividend: DCP is not paying a notable dividend for the ZA market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: DCP is not paying a notable dividend for the ZA market.


Future Payout to Shareholders

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


Next Steps

Management

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

15.0yrs

Average management tenure


CEO

Ivan Saltzman (69yo)

15yrs

Tenure

R12,836,000

Compensation

Mr. Ivan Leon Saltzman has been the Chief Executive Officer and Executive Director of Dis-Chem Pharmacies Limited since May 25, 2005. Mr. Saltzman has 41 years of experience in the pharmaceutical sector in ...


CEO Compensation Analysis

Compensation vs Market: Ivan's total compensation ($USD727.40K) is about average for companies of similar size in the ZA market ($USD932.11K).

Compensation vs Earnings: Ivan's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Ivan Saltzman
CEO & Executive Director15yrsR12.84mno data
Rui Morais
CFO & Executive Director7.75yrsR5.43m0.83% ZAR132.2m
Lynette Saltzman
MD & Executive Director15yrsR10.43mno data
Kim Sim
Chief Information & Innovation Officerno datano datano data
Caryn Barker
Human Resources Directorno datano datano data
Whitney Green
Company Secretaryno datano datano data

15.0yrs

Average Tenure

67yo

Average Age

Experienced Management: DCP's management team is seasoned and experienced (15 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ivan Saltzman
CEO & Executive Director15yrsR12.84mno data
Rui Morais
CFO & Executive Director7.75yrsR5.43m0.83% ZAR132.2m
Lynette Saltzman
MD & Executive Director15yrsR10.43mno data
Laurence Nestadt
Independent Non-Executive Chairmanno dataR2.83m0.058% ZAR9.2m
Mark Bowman
Independent Non-Executive Director3.58yrsR566.00k0.0094% ZAR1.5m
Johannes Mthimunye
Independent Non-Executive Director3.58yrsR666.00k0.0094% ZAR1.5m
Mahomed Salim Gani
Independent Non-Executive Director3yrsR451.00kno data
Anuschka Coovadia
Independent Non-Executive Director3.58yrsR362.00k0.019% ZAR3.0m
Saul Saltzman
Alternate Executive Director13.42yrsR5.34m0.78% ZAR124.5m

5.7yrs

Average Tenure

54yo

Average Age

Experienced Board: DCP's board of directors are considered experienced (5.7 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 not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Dis-Chem Pharmacies Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Dis-Chem Pharmacies Limited
  • Ticker: DCP
  • Exchange: JSE
  • Founded: 1978
  • Industry: Drug Retail
  • Sector: Consumer Retailing
  • Market Cap: R15.894b
  • Shares outstanding: 860.08m
  • Website: https://dischemgroup.com

Number of Employees


Location

  • Dis-Chem Pharmacies Limited
  • 23 Stag Road
  • Glen Austin
  • Midrand
  • Gauteng
  • 1682
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DCPJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARNov 2016

Biography

Dis-Chem Pharmacies Limited engages in the retail and wholesale of healthcare products and pharmaceuticals in South Africa, Namibia, and Botswana. The company operates big box, smaller, and Dis-Chem format stores that offer a range of products, including dispensary, personal care and beauty, healthcare and nutrition, baby care, and other products. Its stores also provides click and collect, as well as ancillary services, such as clinic, and hair and beauty salon services. In addition, the company operates an e-commerce Website, as well as offers pharmaceutical courier services. Further, it is involved in the wholesale of pharmaceutical, health, and front shop products; and provision of customer loyalty programs. The company was founded in 1978 and is headquartered in Midrand, South Africa. Dis-Chem Pharmacies Limited is a subsidiary of Ivlyn No4 Proprietary Limited. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/31 19:15
End of Day Share Price2020/05/29 00:00
Earnings2020/02/29
Annual Earnings2020/02/29


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.