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TCP

Transaction CapitalJSE:TCP Stock Report

Market Cap

R30.0b

7D

-2.3%

1Y

84.2%

Updated

14 Oct, 2021

Data

Company Financials +
TCP fundamental analysis
Snowflake Score
Valuation0/6
Future Growth6/6
Past Performance2/6
Financial Health3/6
Dividends0/6

TCP Overview

Transaction Capital Limited provides non-deposit taking financial services in South Africa and Australia.

Price History & Performance

Summary of all time highs, changes and price drops for Transaction Capital
Historical stock prices
Current Share PriceR41.72
52 Week HighR19.01
52 Week LowR43.90
Beta0.65
1 Month Change6.54%
3 Month Change17.62%
1 Year Change84.19%
3 Year Change126.74%
5 Year Change225.94%
Change since IPO421.50%

Recent News & Updates

Shareholder Returns

TCPZA Consumer FinanceZA Market
7D-2.3%-0.7%1.3%
1Y84.2%57.5%21.2%

Return vs Industry: TCP exceeded the ZA Consumer Finance industry which returned 59.8% over the past year.

Return vs Market: TCP exceeded the ZA Market which returned 20.7% over the past year.

Price Volatility

Is TCP's price volatile compared to industry and market?
TCP volatility
TCP Beta0.65
Industry Beta1.35
Market Beta1

Stable Share Price: TCP is not significantly more volatile than the rest of ZA stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: TCP's weekly volatility (5%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
20073,965Dave Hurwitzhttps://www.transactioncapital.co.za

Transaction Capital Limited provides non-deposit taking financial services in South Africa and Australia. The company offers vehicle procurement, retail, repossession, and refurbishment capabilities, such as asset-backed developmental finance and insurance services for various vehicles; and customer management solutions through its fintech platform that enables its clients to mitigate risk through their customer engagement lifecycle. It also provides business support and working capital finance to SMEs; accounts receivables collection services; payroll, human resources management, access controls, biometrics, employee self-service, recruitment, and outsourcing services, as well as time and attendance solutions; payment solutions; payroll-related services; legal and administrative services; and personal credit information services.

Transaction Capital Fundamentals Summary

How do Transaction Capital's earnings and revenue compare to its market cap?
TCP fundamental statistics
Market CapR29.99b
Earnings (TTM)R399.00m
Revenue (TTM)R4.07b

75.2x

P/E Ratio

7.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
TCP income statement (TTM)
RevenueR4.07b
Cost of RevenueR3.65b
Gross ProfitR420.00m
ExpensesR21.00m
EarningsR399.00m

Last Reported Earnings

Mar 31, 2021

Next Earnings Date

Nov 16, 2021

Earnings per share (EPS)0.55
Gross Margin10.31%
Net Profit Margin9.80%
Debt/Equity Ratio214.5%

How did TCP perform over the long term?

See historical performance and comparison

Dividends

0.9%

Current Dividend Yield

31%

Payout Ratio

Valuation

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

75.18x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: TCP (ZAR41.72) is trading above our estimate of fair value (ZAR2.64)

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


Price To Earnings Ratio

PE vs Industry: TCP is poor value based on its PE Ratio (75.2x) compared to the African Consumer Finance industry average (32.3x).

PE vs Market: TCP is poor value based on its PE Ratio (75.2x) compared to the ZA market (11.1x).


Price to Earnings Growth Ratio

PEG Ratio: TCP is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: TCP is overvalued based on its PB Ratio (4.7x) compared to the XF Consumer Finance industry average (1.4x).


Future Growth

How is Transaction Capital forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

48.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TCP's forecast earnings growth (48.2% per year) is above the savings rate (8.8%).

Earnings vs Market: TCP's earnings (48.2% per year) are forecast to grow faster than the ZA market (12.3% per year).

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

Revenue vs Market: TCP's revenue (21.2% per year) is forecast to grow faster than the ZA market (6.2% per year).

High Growth Revenue: TCP's revenue (21.2% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TCP's Return on Equity is forecast to be high in 3 years time (21.1%)


Past Performance

How has Transaction Capital performed over the past 5 years?

0.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TCP has high quality earnings.

Growing Profit Margin: TCP's current net profit margins (9.8%) are lower than last year (17.6%).


Past Earnings Growth Analysis

Earnings Trend: TCP's earnings have grown by 0.3% per year over the past 5 years.

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

Earnings vs Industry: TCP had negative earnings growth (-45%) over the past year, making it difficult to compare to the Consumer Finance industry average (-50.8%).


Return on Equity

High ROE: TCP's Return on Equity (6.4%) is considered low.


Financial Health

How is Transaction Capital's financial position?


Financial Position Analysis

Short Term Liabilities: TCP's short term assets (ZAR19.3B) exceed its short term liabilities (ZAR1.1B).

Long Term Liabilities: TCP's short term assets (ZAR19.3B) exceed its long term liabilities (ZAR16.1B).


Debt to Equity History and Analysis

Debt Level: TCP's debt to equity ratio (214.5%) is considered high.

Reducing Debt: TCP's debt to equity ratio has reduced from 245.2% to 214.5% over the past 5 years.

Debt Coverage: TCP's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: Insufficient data to determine if TCP's interest payments on its debt are well covered by EBIT.


Balance Sheet


Dividend

What is Transaction Capital current dividend yield, its reliability and sustainability?

0.91%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TCP's dividend (0.91%) isn’t notable compared to the bottom 25% of dividend payers in the ZA market (3.05%).

High Dividend: TCP's dividend (0.91%) is low compared to the top 25% of dividend payers in the ZA market (8.02%).


Stability and Growth of Payments

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

Growing Dividend: TCP 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: TCP is not paying a notable dividend for the ZA market.


Future Payout to Shareholders

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

1.9yrs

Average management tenure


CEO

Dave Hurwitz (49 yo)

7.75yrs

Tenure

R9,097,293

Compensation

Mr. David M. Hurwitz, also known as Dave, BCom (Hon) (Wits), CA (SA), H Dip Tax (Wits), has been the Chief Executive Officer at Transaction Capital Limited since January 16, 2014. Mr. Hurwitz served as the...


CEO Compensation Analysis

Compensation vs Market: Dave's total compensation ($USD614.08K) is below average for companies of similar size in the ZA market ($USD909.96K).

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


Leadership Team

Experienced Management: TCP's management team is not considered experienced ( 1.9 years average tenure), which suggests a new team.


Board Members

Experienced Board: TCP's board of directors are considered experienced (6.5 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 been diluted in the past year, with total shares outstanding growing by 8.7%.


Top Shareholders

Company Information

Transaction Capital Limited's employee growth, exchange listings and data sources


Key Information

  • Name: Transaction Capital Limited
  • Ticker: TCP
  • Exchange: JSE
  • Founded: 2007
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: R29.995b
  • Shares outstanding: 718.96m
  • Website: https://www.transactioncapital.co.za

Number of Employees


Location

  • Transaction Capital Limited
  • 342 Jan Smuts Avenue
  • Hyde Park
  • Johannesburg
  • Gauteng
  • 2196
  • South Africa

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/14 21:26
End of Day Share Price2021/10/14 00:00
Earnings2021/03/31
Annual Earnings2020/09/30


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.