McMillan Shakespeare Limited (MMS)
Views and News
A Sound Performer: Salary Packaging Services & Vehicle Leasing
A leader in Australian salary packaging services and administration, including vehicle leasing. Credit and treasury operations are sound and provide flexibility. Growth prospects are well into double digits. We see a franked dividend yield above 5 per cent.
Half-year Performance & Estimates - MMS
| Year-end June | 1H12A | FY12A | 1H13A | FY13A | 1H14A | FY14E | FY15E |
|---|---|---|---|---|---|---|---|
| Sales, $m | 143.1 | 300.7 | 160.2 | 327.4 | 161.4 | 348.0 | 405.0 |
| EBITDA, $m | 75.8 | 158.1 | 85.3 | 177.3 | 77.2 | 170.7 | 210.7 |
| EBIT, $m | 40.7 | 86.4 | 46.7 | 97.3 | 33.3 | 81.2 | 111.2 |
| Report NPAT, $m | 25.0 | 54.4 | 29.8 | 62.2 | 19.3 | ||
| Adj. NPAT, $m | 19.3 | 54.1 | 73.5 | ||||
| Reported EPS, ¢ | 35.00 | 74.00 | 39.00 | 82.00 | 25.00 | ||
| Adjusted EPS, ¢ | 25.00 | 70.80 | 93.00 | ||||
| EPS %FY/Growth | 47% | 48% | 11% | -36% | -14% | 31% | |
| Dividend, ¢ | 22.0 | 47.0 | 24.0 | 24.0 | 21.0 | 44.50 | 55.50 |
| Franking, % | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
| EBITDA Margin | 0 | 53% | 53% | 54% | 48% | 49.1% | 52.0% |
| NPAT Margin | 0 | 18% | 19% | 19% | 12% | 15.5% | 18.1% |
| ROE, % | 0 | 32% | 17% | 32% | 10% | ||
| EBIT/Interest | 0.0 | 9.6 | 11.3 | 11.6 | 7.4 | ||
| Net Debt / Equity | 0 | 0.60 | 0.75 | 0.64 | 0.77 | ||
| CashFlow/Sh, ¢ | 12.9 | 28.3 | -13.3 | 37.0 | 0.9 | 44.0 | 63.2 |
| Y/E Shares, m | 70.7 | 74.6 | 74.6 | 74.6 | 74.5 |
| Notes |
| Data sourced from IRESS Market Technology Limited. EPS Growth compared with the pcp is shown in most columns except the first half years which show their percentage of full year EPS. In a handful of cases, unadjusted share splits, or changes between positive and negative values, may give strange changes in ratios. |
Recent News Highlights
As at 31/12/2012 : see details at www.mcms.com.au (new window? Shift+Click)
| 07/12/2012 S&P/ASX 200 Index Quarterly Rebalancing - MMS to Join Index Effective 22 Dec |
| 22/10/2012 2012 AGM - Chairman's Address & CEO Presentation |
| 18/10/2012 Merrill Lynch Emerging Stars Conference 2012 Presentation |
| 10/09/2012 2012 Annual Report to Shareholders |
| 21/08/2012 FY12 Full Year Results & Presentation |
| 25/10/2011 AGM - Chairman's Address & CEO Presentation |
Russell Research in the media
Stock Picks for The Bull.com.au - 29 July 2013
BUY McMillan Shakespeare (MMS)
I believe the company will work extremely hard and will successfully minimise any further adverse impact. In my view, it’s more likely the FBT proposal will be ditched by a change of government, or likely defeated or modified if Labor wins. I believe a good opportunity exists, irrespective of which party wins the next election.
Stock Picks for Sunday Herald Sun – 28 July 2013
BUY McMillan Shakespeare (MMS) $9.80
The salary packaging and vehicle leasing leader has a strong growth record and prospect despite Labour’s new controversial proposal to amend FBT, that sliced the share price.
Stock Picks for Sunday Herald Sun – 2 December 2012
BUY McMillan Shakespeare Limited, MMS, $13.30
This leader in the salary packaging and vehicle leasing business should grow in double digits. Return on equity 32 per cent, 4 per cent franked yield.
Stock Picks for The Bull.com.au - 5 November 2012
BUY McMillan Shakespeare (MMS) ($12.97)
This substantial salary packaging and vehicle-leasing group has averaged 30 per cent earnings per share growth in the past five years. New contract wins and ongoing business growth should retain it in double digits - with a franked yield above 4 per cent. Already a leader in salary packaging, complementary acquisitions of leasing businesses in 2010 have contributed to boosting net profit after tax growth.
Wave Chart
Company Overview
Profile
McMillan Shakespeare
Rating: ♥
Category: Best Stock ; Midcaps
Action: Accumulate
Website: www.mcms.com.au
| ASX code: | MMS |
| Closing Price, 20/06/14: | $ 9.490 |
| Market Capitalisation: | $ 707 million |
| 52 Week High: | $ 18.64 |
| 52 Week Low: | $ 6.75 |
| Sector: | Human Resource & Employment Services |
| Index: | S&P/ASX 200 Index |
Summary of Fundamentals
| Year-end June | FY12A | FY13A | FY14E | FY15E |
|---|---|---|---|---|
| NPAT, $m | 54.4 | 62.2 | 54.1 | 73.5 |
| Reported EPS, ¢ | 74.00 | 82.00 | ||
| Adjusted EPS, ¢ | 62.16 | 70.80 | 93.00 | |
| EPS Growth, % | 21% | -16% | 14% | 31% |
| P/E Ratio, x | 12.82 | 15.27 | 13.40 | 10.20 |
| Dividend, ¢ | 47.0 | 24.0 | 44.50 | 55.50 |
| Franking, % | 100% | 100% | 100% | 100% |
| Div. Yield, % | 4.95 | 2.53 | 4.69 | 5.85 |
Notes
| Our Adjusted EPS is used for the last year and forward estimates and as basis for EPS Growth and P/E Ratio. We currently use Reported data for all historic NPAT, for the prior year EPS and as base for last year EPS growth. |
| Data & Chart sourced from IRESS Market Technology Ltd. |
One Year Chart
As at 23 June 2014
Other Highlights
| Sector: | Human Resource & Employment Services |
| Return on Equity, FY13 : | 32% |
| Net Debt to Equity, FY13 : | 64 % |
| EBIT / Interest Cover, FY13 : | 11.62 x |
| Gicscode: | 20202010 |
| First Listed: | 15-Mar-04 |
Business Activities
McMillan Shakespeare Limited (MMS) is a major provider of independent salary packaging services in Australia, including vehicle leasing and fleet management.
Glossary:
| ♠ | "A Core Stock" - reliable long-term yield & growth |
| ♥ | "We like it" - a seasoned performer, growth & yield |
| ♦ | "A tough scout" - creating a potential breakthrough |
| ♣ | "A steady performer" - giving reliable yield or growth |
| Best Stocks | Portfolio of selected attractive investments |
| Potential | Stocks that may have good improvement prospects |
| Speculative | More risky usually smaller stocks with spec. upside |
| Midcaps | In RR Midcap Index, $ 70m to 1,500m market cap. |
| Large Stocks | Larger Stocks upwards of $ 1,500m market cap |