TESCO PLC (TCO0.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:TCO0 - GB00BLGZ9862 - Common Stock
4.84 EUR
-0.02 (-0.41%)
TCO0 gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 24 industry peers in the Consumer Staples Distribution & Retail industry. TCO0 has a medium profitability rating, but doesn't score so well on its financial health evaluation. TCO0 has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year TCO0 was profitable.
- TCO0 had a positive operating cash flow in the past year.
- In the past 5 years TCO0 has always been profitable.
- In the past 5 years TCO0 always reported a positive cash flow from operatings.
1.2 Ratios
- TCO0's Return On Assets of 4.18% is fine compared to the rest of the industry. TCO0 outperforms 62.50% of its industry peers.
- TCO0 has a Return On Equity (13.94%) which is comparable to the rest of the industry.
- Looking at the Return On Invested Capital, with a value of 8.79%, TCO0 is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for TCO0 is below the industry average of 9.20%.
- The last Return On Invested Capital (8.79%) for TCO0 is above the 3 year average (6.99%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.18% | ||
| ROE | 13.94% | ||
| ROIC | 8.79% |
ROA(3y)2.77%
ROA(5y)4.88%
ROE(3y)10.05%
ROE(5y)17.78%
ROIC(3y)6.99%
ROIC(5y)6.43%
1.3 Margins
- Looking at the Profit Margin, with a value of 2.33%, TCO0 is in the better half of the industry, outperforming 70.83% of the companies in the same industry.
- In the last couple of years the Profit Margin of TCO0 has grown nicely.
- TCO0 has a Operating Margin of 4.37%. This is amongst the best in the industry. TCO0 outperforms 83.33% of its industry peers.
- In the last couple of years the Operating Margin of TCO0 has remained more or less at the same level.
- TCO0 has a Gross Margin of 7.68%. This is amonst the worse of the industry: TCO0 underperforms 95.83% of its industry peers.
- In the last couple of years the Gross Margin of TCO0 has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.37% | ||
| PM (TTM) | 2.33% | ||
| GM | 7.68% |
OM growth 3Y-0.4%
OM growth 5Y-1.06%
PM growth 3Y-1.24%
PM growth 5Y6.83%
GM growth 3Y-0.41%
GM growth 5Y-0.13%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so TCO0 is still creating some value.
- TCO0 has less shares outstanding than it did 1 year ago.
- Compared to 5 years ago, TCO0 has less shares outstanding
- The debt/assets ratio for TCO0 is higher compared to a year ago.
2.2 Solvency
- TCO0 has an Altman-Z score of 2.72. This is not the best score and indicates that TCO0 is in the grey zone with still only limited risk for bankruptcy at the moment.
- TCO0 has a Altman-Z score of 2.72. This is comparable to the rest of the industry: TCO0 outperforms 45.83% of its industry peers.
- TCO0 has a debt to FCF ratio of 10.60. This is a negative value and a sign of low solvency as TCO0 would need 10.60 years to pay back of all of its debts.
- TCO0 has a worse Debt to FCF ratio (10.60) than 70.83% of its industry peers.
- A Debt/Equity ratio of 1.12 is on the high side and indicates that TCO0 has dependencies on debt financing.
- TCO0 has a Debt to Equity ratio of 1.12. This is in the lower half of the industry: TCO0 underperforms 62.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.12 | ||
| Debt/FCF | 10.6 | ||
| Altman-Z | 2.72 |
ROIC/WACC1.16
WACC7.58%
2.3 Liquidity
- TCO0 has a Current Ratio of 0.64. This is a bad value and indicates that TCO0 is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Current ratio of TCO0 (0.64) is worse than 91.67% of its industry peers.
- TCO0 has a Quick Ratio of 0.64. This is a bad value and indicates that TCO0 is not financially healthy enough and could expect problems in meeting its short term obligations.
- TCO0's Quick ratio of 0.44 is in line compared to the rest of the industry. TCO0 outperforms 50.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.64 | ||
| Quick Ratio | 0.44 |
3. Growth
3.1 Past
- TCO0 shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.39%, which is quite good.
- The Earnings Per Share has been growing slightly by 3.47% on average over the past years.
- Looking at the last year, TCO0 shows a small growth in Revenue. The Revenue has grown by 3.44% in the last year.
- TCO0 shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.78% yearly.
EPS 1Y (TTM)9.39%
EPS 3Y7.96%
EPS 5Y3.47%
EPS Q2Q%5.54%
Revenue 1Y (TTM)3.44%
Revenue growth 3Y4.46%
Revenue growth 5Y3.78%
Sales Q2Q%2.43%
3.2 Future
- Based on estimates for the next years, TCO0 will show a small growth in Earnings Per Share. The EPS will grow by 4.68% on average per year.
- The Revenue is expected to grow by 2.91% on average over the next years.
EPS Next Y4.44%
EPS Next 2Y7.42%
EPS Next 3Y7.86%
EPS Next 5Y4.68%
Revenue Next Year3.96%
Revenue Next 2Y3.43%
Revenue Next 3Y3.08%
Revenue Next 5Y2.91%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 15.13, TCO0 is valued correctly.
- TCO0's Price/Earnings is on the same level as the industry average.
- TCO0's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.21.
- With a Price/Forward Earnings ratio of 13.30, TCO0 is valued correctly.
- The rest of the industry has a similar Price/Forward Earnings ratio as TCO0.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.98, TCO0 is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.13 | ||
| Fwd PE | 13.3 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, TCO0 is valued a bit cheaper than 66.67% of the companies in the same industry.
- The rest of the industry has a similar Price/Free Cash Flow ratio as TCO0.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.5 | ||
| EV/EBITDA | 6.99 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TCO0 does not grow enough to justify the current Price/Earnings ratio.
- The decent profitability rating of TCO0 may justify a higher PE ratio.
PEG (NY)3.4
PEG (5Y)4.36
EPS Next 2Y7.42%
EPS Next 3Y7.86%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.42%, TCO0 has a reasonable but not impressive dividend return.
- TCO0's Dividend Yield is a higher than the industry average which is at 2.82.
- Compared to an average S&P500 Dividend Yield of 1.81, TCO0 pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.42% |
5.2 History
- The dividend of TCO0 is nicely growing with an annual growth rate of 8.14%!
Dividend Growth(5Y)8.14%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- 53.14% of the earnings are spent on dividend by TCO0. This is a bit on the high side, but may be sustainable.
- The dividend of TCO0 is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP53.14%
EPS Next 2Y7.42%
EPS Next 3Y7.86%
TESCO PLC / TCO0.DE FAQ
What is the fundamental rating for TCO0 stock?
ChartMill assigns a fundamental rating of 4 / 10 to TCO0.DE.
What is the valuation status for TCO0 stock?
ChartMill assigns a valuation rating of 4 / 10 to TESCO PLC (TCO0.DE). This can be considered as Fairly Valued.
What is the profitability of TCO0 stock?
TESCO PLC (TCO0.DE) has a profitability rating of 6 / 10.
What is the financial health of TESCO PLC (TCO0.DE) stock?
The financial health rating of TESCO PLC (TCO0.DE) is 2 / 10.
What is the expected EPS growth for TESCO PLC (TCO0.DE) stock?
The Earnings per Share (EPS) of TESCO PLC (TCO0.DE) is expected to grow by 4.44% in the next year.