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TESCO PLC (TCO0.DE) Stock Fundamental Analysis

FRA:TCO0 - Deutsche Boerse Ag - GB00BLGZ9862 - Common Stock - Currency: EUR

4.54  +0.02 (+0.44%)

Fundamental Rating

4

Taking everything into account, TCO0 scores 4 out of 10 in our fundamental rating. TCO0 was compared to 27 industry peers in the Consumer Staples Distribution & Retail industry. There are concerns on the financial health of TCO0 while its profitability can be described as average. TCO0 has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

4

1. Profitability

1.1 Basic Checks

In the past year TCO0 was profitable.
In the past year TCO0 had a positive cash flow from operations.
Each year in the past 5 years TCO0 has been profitable.
TCO0 had a positive operating cash flow in each of the past 5 years.
TCO0.DE Yearly Net Income VS EBIT VS OCF VS FCFTCO0.DE Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 2B -2B 4B -4B

1.2 Ratios

TCO0's Return On Assets of 2.76% is on the low side compared to the rest of the industry. TCO0 is outperformed by 61.54% of its industry peers.
TCO0's Return On Equity of 11.32% is in line compared to the rest of the industry. TCO0 outperforms 42.31% of its industry peers.
TCO0 has a Return On Invested Capital (6.43%) which is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for TCO0 is below the industry average of 9.71%.
The 3 year average ROIC (6.15%) for TCO0 is below the current ROIC(6.43%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 2.76%
ROE 11.32%
ROIC 6.43%
ROA(3y)2.38%
ROA(5y)4.41%
ROE(3y)8.55%
ROE(5y)16.45%
ROIC(3y)6.15%
ROIC(5y)5.92%
TCO0.DE Yearly ROA, ROE, ROICTCO0.DE Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 20 30 40

1.3 Margins

The Profit Margin of TCO0 (1.91%) is worse than 61.54% of its industry peers.
In the last couple of years the Profit Margin of TCO0 has declined.
TCO0 has a Operating Margin of 4.20%. This is in the better half of the industry: TCO0 outperforms 76.92% of its industry peers.
TCO0's Operating Margin has been stable in the last couple of years.
TCO0's Gross Margin of 7.24% is on the low side compared to the rest of the industry. TCO0 is outperformed by 96.15% of its industry peers.
TCO0's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 4.2%
PM (TTM) 1.91%
GM 7.24%
OM growth 3Y3.72%
OM growth 5Y0.42%
PM growth 3Y-44.67%
PM growth 5Y-2.6%
GM growth 3Y1.51%
GM growth 5Y-0.16%
TCO0.DE Yearly Profit, Operating, Gross MarginsTCO0.DE Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5 -5 10 -10

2

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so TCO0 is destroying value.
The number of shares outstanding for TCO0 has been reduced compared to 1 year ago.
The number of shares outstanding for TCO0 has been reduced compared to 5 years ago.
Compared to 1 year ago, TCO0 has an improved debt to assets ratio.
TCO0.DE Yearly Shares OutstandingTCO0.DE Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B
TCO0.DE Yearly Total Debt VS Total AssetsTCO0.DE Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 10B 20B 30B 40B 50B

2.2 Solvency

An Altman-Z score of 2.13 indicates that TCO0 is not a great score, but indicates only limited risk for bankruptcy at the moment.
TCO0 has a Altman-Z score of 2.13. This is in the lower half of the industry: TCO0 underperforms 76.92% of its industry peers.
TCO0 has a debt to FCF ratio of 9.94. This is a negative value and a sign of low solvency as TCO0 would need 9.94 years to pay back of all of its debts.
TCO0's Debt to FCF ratio of 9.94 is on the low side compared to the rest of the industry. TCO0 is outperformed by 76.92% of its industry peers.
TCO0 has a Debt/Equity ratio of 1.17. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.17, TCO0 is not doing good in the industry: 69.23% of the companies in the same industry are doing better.
Industry RankSector Rank
Debt/Equity 1.17
Debt/FCF 9.94
Altman-Z 2.13
ROIC/WACC0.89
WACC7.25%
TCO0.DE Yearly LT Debt VS Equity VS FCFTCO0.DE Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 5B 10B 15B

2.3 Liquidity

A Current Ratio of 0.66 indicates that TCO0 may have some problems paying its short term obligations.
TCO0 has a Current ratio of 0.66. This is amonst the worse of the industry: TCO0 underperforms 84.62% of its industry peers.
A Quick Ratio of 0.46 indicates that TCO0 may have some problems paying its short term obligations.
TCO0 has a Quick ratio (0.46) which is comparable to the rest of the industry.
Industry RankSector Rank
Current Ratio 0.66
Quick Ratio 0.46
TCO0.DE Yearly Current Assets VS Current LiabilitesTCO0.DE Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

4

3. Growth

3.1 Past

TCO0 shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -1.62%.
Measured over the past 5 years, TCO0 shows a small growth in Earnings Per Share. The EPS has been growing by 6.69% on average per year.
TCO0 shows a small growth in Revenue. In the last year, the Revenue has grown by 3.31%.
TCO0 shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 1.30% yearly.
EPS 1Y (TTM)-1.62%
EPS 3Y24.73%
EPS 5Y6.69%
EPS Q2Q%19.25%
Revenue 1Y (TTM)3.31%
Revenue growth 3Y5.61%
Revenue growth 5Y1.3%
Sales Q2Q%3.02%

3.2 Future

The Earnings Per Share is expected to grow by 6.14% on average over the next years.
Based on estimates for the next years, TCO0 will show a small growth in Revenue. The Revenue will grow by 1.86% on average per year.
EPS Next Y15.09%
EPS Next 2Y12.03%
EPS Next 3Y10.95%
EPS Next 5Y6.14%
Revenue Next Year1.78%
Revenue Next 2Y2.25%
Revenue Next 3Y2.31%
Revenue Next 5Y1.86%

3.3 Evolution

The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
TCO0.DE Yearly Revenue VS EstimatesTCO0.DE Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 20B 40B 60B 80B
TCO0.DE Yearly EPS VS EstimatesTCO0.DE Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 0.1 0.2 0.3

5

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 14.65, which indicates a correct valuation of TCO0.
Based on the Price/Earnings ratio, TCO0 is valued a bit cheaper than 65.38% of the companies in the same industry.
TCO0 is valuated rather cheaply when we compare the Price/Earnings ratio to 28.47, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 12.85, TCO0 is valued correctly.
The rest of the industry has a similar Price/Forward Earnings ratio as TCO0.
When comparing the Price/Forward Earnings ratio of TCO0 to the average of the S&P500 Index (92.74), we can say TCO0 is valued rather cheaply.
Industry RankSector Rank
PE 14.65
Fwd PE 12.85
TCO0.DE Price Earnings VS Forward Price EarningsTCO0.DE Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 20 40 60 80

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TCO0 indicates a somewhat cheap valuation: TCO0 is cheaper than 69.23% of the companies listed in the same industry.
TCO0's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 17.3
EV/EBITDA 6.84
TCO0.DE Per share dataTCO0.DE EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 2 4 6 8 10

4.3 Compensation for Growth

TCO0's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
PEG (NY)0.97
PEG (5Y)2.19
EPS Next 2Y12.03%
EPS Next 3Y10.95%

4

5. Dividend

5.1 Amount

TCO0 has a Yearly Dividend Yield of 3.34%.
Compared to an average industry Dividend Yield of 3.91, TCO0 pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.28, TCO0 pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 3.34%

5.2 History

On average, the dividend of TCO0 grows each year by 16.60%, which is quite nice.
Dividend Growth(5Y)16.6%
Div Incr Years1
Div Non Decr Years1
TCO0.DE Yearly Dividends per shareTCO0.DE Yearly Dividends per shareYearly Dividends per share 2021 2022 2023 2024 0.1 0.2 0.3 0.4 0.5

5.3 Sustainability

64.33% of the earnings are spent on dividend by TCO0. This is not a sustainable payout ratio.
TCO0's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP64.33%
EPS Next 2Y12.03%
EPS Next 3Y10.95%
TCO0.DE Yearly Income VS Free CF VS DividendTCO0.DE Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 2B -2B 4B -4B
TCO0.DE Dividend Payout.TCO0.DE Dividend Payout, showing the Payout Ratio.TCO0.DE Dividend Payout.PayoutRetained Earnings

TESCO PLC

FRA:TCO0 (2/4/2025, 7:00:00 PM)

4.54

+0.02 (+0.44%)

Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)10-03 2024-10-03/bmo
Earnings (Next)N/A N/A
Inst Owners55.56%
Inst Owner ChangeN/A
Ins Owners1.42%
Ins Owner ChangeN/A
Market Cap30.63B
Analysts78.1
Price Target4.89 (7.71%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 3.34%
Yearly Dividend0.11
Dividend Growth(5Y)16.6%
DP64.33%
Div Incr Years1
Div Non Decr Years1
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-2.19%
PT rev (3m)-0.72%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0.71%
EPS NY rev (3m)4.55%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.02%
Valuation
Industry RankSector Rank
PE 14.65
Fwd PE 12.85
P/S 0.37
P/FCF 17.3
P/OCF 8.96
P/B 2.2
P/tB 3.94
EV/EBITDA 6.84
EPS(TTM)0.31
EY6.83%
EPS(NY)0.35
Fwd EY7.78%
FCF(TTM)0.26
FCFY5.78%
OCF(TTM)0.51
OCFY11.16%
SpS12.26
BVpS2.06
TBVpS1.15
PEG (NY)0.97
PEG (5Y)2.19
Profitability
Industry RankSector Rank
ROA 2.76%
ROE 11.32%
ROCE 8.73%
ROIC 6.43%
ROICexc 7.64%
ROICexgc 9.3%
OM 4.2%
PM (TTM) 1.91%
GM 7.24%
FCFM 2.14%
ROA(3y)2.38%
ROA(5y)4.41%
ROE(3y)8.55%
ROE(5y)16.45%
ROIC(3y)6.15%
ROIC(5y)5.92%
ROICexc(3y)7.16%
ROICexc(5y)7.11%
ROICexgc(3y)8.86%
ROICexgc(5y)8.95%
ROCE(3y)8.31%
ROCE(5y)7.95%
ROICexcg growth 3Y4.07%
ROICexcg growth 5Y2.01%
ROICexc growth 3Y5.48%
ROICexc growth 5Y2.73%
OM growth 3Y3.72%
OM growth 5Y0.42%
PM growth 3Y-44.67%
PM growth 5Y-2.6%
GM growth 3Y1.51%
GM growth 5Y-0.16%
F-Score7
Asset Turnover1.45
Health
Industry RankSector Rank
Debt/Equity 1.17
Debt/FCF 9.94
Debt/EBITDA 2.92
Cap/Depr 78.78%
Cap/Sales 1.99%
Interest Coverage 3.53
Cash Conversion 61.46%
Profit Quality 112.27%
Current Ratio 0.66
Quick Ratio 0.46
Altman-Z 2.13
F-Score7
WACC7.25%
ROIC/WACC0.89
Cap/Depr(3y)74.18%
Cap/Depr(5y)71.26%
Cap/Sales(3y)1.96%
Cap/Sales(5y)2.06%
Profit Quality(3y)228.97%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-1.62%
EPS 3Y24.73%
EPS 5Y6.69%
EPS Q2Q%19.25%
EPS Next Y15.09%
EPS Next 2Y12.03%
EPS Next 3Y10.95%
EPS Next 5Y6.14%
Revenue 1Y (TTM)3.31%
Revenue growth 3Y5.61%
Revenue growth 5Y1.3%
Sales Q2Q%3.02%
Revenue Next Year1.78%
Revenue Next 2Y2.25%
Revenue Next 3Y2.31%
Revenue Next 5Y1.86%
EBIT growth 1Y14.65%
EBIT growth 3Y9.54%
EBIT growth 5Y1.73%
EBIT Next Year65.62%
EBIT Next 3Y20.68%
EBIT Next 5Y11.24%
FCF growth 1Y-36.67%
FCF growth 3YN/A
FCF growth 5Y10.83%
OCF growth 1Y-18.4%
OCF growth 3Y79%
OCF growth 5Y6.48%