JSE:PIK

Stock Analysis Report

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Executive Summary

Pick n Pay Stores Limited, an investment holding company, engages in the retail of food, clothing, general merchandise, pharmaceuticals, and liquor in South Africa and Rest of Africa.


Snowflake Analysis

Acceptable track record and slightly overvalued.


Similar Companies

Share Price & News

How has Pick n Pay Stores's share price performed over time and what events caused price changes?


Latest Share Price and Events

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


Market Performance


7 Day Return

3.0%

PIK

3.4%

ZA Consumer Retailing

-0.7%

ZA Market


1 Year Return

-24.9%

PIK

-21.3%

ZA Consumer Retailing

-23.8%

ZA Market

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

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


Shareholder returns

PIKIndustryMarket
7 Day3.0%3.4%-0.7%
30 Day-8.1%-2.3%-0.6%
90 Day-4.2%-8.8%-8.1%
1 Year-22.3%-24.9%-19.2%-21.3%-13.0%-23.8%
3 Year-3.4%-11.6%-16.6%-22.2%0.3%-18.8%
5 Year11.8%-2.0%1.6%-10.5%9.9%-17.5%

Price Volatility Vs. Market

How volatile is Pick n Pay Stores's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Pick n Pay Stores undervalued compared to its fair value and its price relative to the market?

41.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: PIK (ZAR53.29) is trading below our estimate of fair value (ZAR90.75)

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


Price To Earnings Ratio

PE vs Industry: PIK is poor value based on its PE Ratio (21.2x) compared to the Consumer Retailing industry average (17.6x).

PE vs Market: PIK is poor value based on its PE Ratio (21.2x) compared to the ZA market (8x).


Price to Earnings Growth Ratio

PEG Ratio: PIK is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: PIK is overvalued based on its PB Ratio (8.5x) compared to the ZA Consumer Retailing industry average (4x).


Next Steps

Future Growth

How is Pick n Pay Stores forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

12.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: PIK's forecast earnings growth (12.1% per year) is above the savings rate (9.5%).

Earnings vs Market: PIK's earnings (12.1% per year) are forecast to grow slower than the ZA market (19.2% per year).

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

Revenue vs Market: PIK's revenue (4.3% per year) is forecast to grow slower than the ZA market (8.5% per year).

High Growth Revenue: PIK's revenue (4.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: PIK's Return on Equity is forecast to be high in 3 years time (37.6%)


Next Steps

Past Performance

How has Pick n Pay Stores performed over the past 5 years?

11.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: PIK has high quality earnings.

Growing Profit Margin: PIK's current net profit margins (1.3%) are lower than last year (1.8%).


Past Earnings Growth Analysis

Earnings Trend: PIK's earnings have grown by 11.4% per year over the past 5 years.

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

Earnings vs Industry: PIK had negative earnings growth (-27.5%) over the past year, making it difficult to compare to the Consumer Retailing industry average (6.2%).


Return on Equity

High ROE: PIK's Return on Equity (39.7%) is considered high.


Next Steps

Financial Health

How is Pick n Pay Stores's financial position?


Financial Position Analysis

Short Term Liabilities: PIK's short term assets (ZAR12.9B) do not cover its short term liabilities (ZAR16.3B).

Long Term Liabilities: PIK's short term assets (ZAR12.9B) do not cover its long term liabilities (ZAR14.2B).


Debt to Equity History and Analysis

Debt Level: PIK's debt to equity ratio (99.2%) is considered high.

Reducing Debt: PIK's debt to equity ratio has increased from 36.3% to 99.2% over the past 5 years.

Debt Coverage: PIK's debt is well covered by operating cash flow (155.3%).

Interest Coverage: PIK's interest payments on its debt are not well covered by EBIT (2.4x coverage).


Balance Sheet


Next Steps

Dividend

What is Pick n Pay Stores's current dividend yield, its reliability and sustainability?

4.09%

Forecast Dividend Yield


Dividend Yield vs Market

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

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


Stability and Growth of Payments

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

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


Current Payout to Shareholders

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


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of PIK'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?

2.8yrs

Average management tenure


CEO

Richard William Brasher (57yo)

7.33yrs

Tenure

R64,467,400

Compensation

Mr. Richard William Peter Brasher, BSc (Hons) has been the Chief Executive Officer of Pick n Pay Stores Ltd. since January 23, 2013. Mr. Brasher served as the Chief Executive Officer of the U K and ROI at ...


CEO Compensation Analysis

Compensation vs Market: Richard William's total compensation ($USD3.65M) is above average for companies of similar size in the ZA market ($USD1.17M).

Compensation vs Earnings: Richard William's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Richard William Brasher
CEO & Executive Director7.33yrsR64.47m0.46% ZAR111.6m
Richard S. van Rensburg
Chief Information Officer & Executive Director10.83yrsR14.88m0.048% ZAR11.5m
Suzanne Ackerman-Berman
Director of Transformation & Executive Director10.17yrsR6.70m0.19% ZAR45.4m
Jonathan Ackerman
Customer Director & Executive Director10.17yrsR4.04m0.21% ZAR51.3m
Wendy Ackerman
Honorary Life Presidentno dataR65.00kno data
Raymond Ackerman
Founderno dataR65.00kno data
Lerena Olivier
CFO & Executive Director0.58yrno datano data
Penny Gerber
Divisional Director of Corporate Financeno datano datano data
Debra Muller
Head of Legal Department & Company Secretaryno datano datano data
Paula Disberry
Executive of Commercial & Marketing2.83yrsno datano data

2.8yrs

Average Tenure

57yo

Average Age

Experienced Management: PIK's management team is considered experienced (2.8 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Richard William Brasher
CEO & Executive Director7.33yrsR64.47m0.46% ZAR111.6m
Richard S. van Rensburg
Chief Information Officer & Executive Director10.83yrsR14.88m0.048% ZAR11.5m
Suzanne Ackerman-Berman
Director of Transformation & Executive Director10.17yrsR6.70m0.19% ZAR45.4m
Jonathan Ackerman
Customer Director & Executive Director10.17yrsR4.04m0.21% ZAR51.3m
Raymond Ackerman
Founderno dataR65.00kno data
Lerena Olivier
CFO & Executive Director0.58yrno datano data
Hugh Herman
Lead Independent Non Executive Director10.58yrsR910.00k0.0067% ZAR1.6m
Gareth Ackerman
Non-Executive Chairman10.17yrsR4.44m0.38% ZAR91.9m
David Robins
Non-Executive Director18.33yrsR413.00k0.020% ZAR4.9m
Jeffrey van Rooyen
Independent Non-Executive Director13.17yrsR883.00kno data

10.2yrs

Average Tenure

61yo

Average Age

Experienced Board: PIK's board of directors are seasoned and experienced ( 10.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: PIK 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

Pick n Pay Stores Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Pick n Pay Stores Limited
  • Ticker: PIK
  • Exchange: JSE
  • Founded: 1967
  • Industry: Food Retail
  • Sector: Consumer Retailing
  • Market Cap: R24.066b
  • Shares outstanding: 451.60m
  • Website: https://www.pnp.co.za

Number of Employees


Location

  • Pick n Pay Stores Limited
  • Pick n Pay Office Park
  • 101 Rosmead Avenue
  • Cape Town
  • Western Cape
  • 7708
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PIKJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARNov 1992
PIKDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1992
PKPY.YOTCPK (Pink Sheets LLC)ADRUSUSDOct 2008

Biography

Pick n Pay Stores Limited, an investment holding company, engages in the retail of food, clothing, general merchandise, pharmaceuticals, and liquor in South Africa and Rest of Africa. It owns, franchises, and invests in hypermarkets, supermarkets, local stores, clothing stores, liquor stores, pharmacy stores, superstores, build stores, punch stores, and express stores under the Pick n Pay and Boxer brands, which offer food products, wine, clothing, and health and wellness products. The company also offers its products through online. In addition, it acquires and develops retail and distribution sites; and provides financial, travel, bill and electricity payment, Web ticket, and courier services, as well as gift cards. The company operates a network of 1,795 owned and franchised stores. The company was founded in 1967 and is based in Cape Town, South Africa. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/05/31 18:58
End of Day Share Price2020/05/29 00:00
Earnings2020/03/01
Annual Earnings2020/03/01


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.