Compass Group Plc (CPG) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

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Comparison

Company

Score

Quality

Valuation

Financial

Technical

Mitchells & Butlers Plc

Marston's Plc

JD Wetherspoon Plc

Compass Group Plc

Fuller, Smith & Turner Plc

Loungers Plc

Young & Co.'s Brewery Plc

SSP Group Plc

Domino's Pizza Group Plc

DP Eurasia NV

The Restaurant Group Plc

Why is Compass Group Plc ?

Strong Long Term Fundamental Strength with an average Return on Capital Employed (ROCE) of 17.93%

Company's ability to service its debt is strong with a healthy EBIT to Interest (avg) ratio of 8.64

Positive results in Mar 25

OPERATING CASH FLOW(Y) Highest at GBP 4,806.67 MM
DIVIDEND PER SHARE(HY) Highest at GBP 7.83
OPERATING PROFIT(Q) Highest at GBP 1,710.32 MM

With ROE of 24.35%, it has a very expensive valuation with a 7.91 Price to Book Value

Over the past year, while the stock has generated a return of -13.58%, its profits have fallen by -6.7%

Below par performance in long term as well as near term

Along with generating -13.58% returns in the last 1 year, the stock has also underperformed FTSE 100 in the last 3 years, 1 year and 3 months

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Compass Group Plc should be less than 10%
Overall Portfolio exposure to Leisure Services should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Leisure Services)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Compass Group Plc for you?

Low Risk, Low Return

Absolute

Risk Adjusted

Volatility

Compass Group Plc

-13.58%

-0.36

20.63%

FTSE 100

15.94%

1.23

12.99%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

12.08%

EBIT Growth (5y)

32.94%

EBIT to Interest (avg)

8.64

Debt to EBITDA (avg)

1.37

Net Debt to Equity (avg)

0.77

Sales to Capital Employed (avg)

3.01

Tax Ratio

31.82%

Dividend Payout Ratio

58.71%

Pledged Shares

Institutional Holding

0.00%

ROCE (avg)

17.93%

ROE (avg)

18.92%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

7.91

EV to EBIT

20.52

EV to EBITDA

14.14

EV to Capital Employed

4.91

EV to Sales

1.36

PEG Ratio

Dividend Yield

193.93%

ROCE (Latest)

23.94%

ROE (Latest)

24.35%

Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Bearish

Mildly Bearish

RSI

No Signal

Bollinger Bands

Bearish

Moving Averages

Bearish (Daily)

KST

Bearish

Mildly Bearish

Dow Theory

Mildly Bearish

OBV

Mildly Bearish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

11What is working for the Company

OPERATING CASH FLOW(Y)

Highest at GBP 4,806.67 MM

DIVIDEND PER SHARE(HY)

Highest at GBP 7.83

OPERATING PROFIT(Q)

Highest at GBP 1,710.32 MM

RAW MATERIAL COST(Y)

Fallen by -3.48% (YoY

NET SALES(Q)

Highest at GBP 17,762.73 MM

PRE-TAX PROFIT(Q)

Highest at GBP 1,033.43 MM

EPS(Q)

Highest at GBP 0.43

-5What is not working for the Company

INTEREST(HY)

At GBP 131.44 MM has Grown at 27.78%

INTEREST COVERAGE RATIO(Q)

Lowest at 1,301.2

DEBT-EQUITY RATIO (HY)

Highest at 92.79 %

Here's what is working for Compass Group Plc

Operating Cash Flow

Highest at GBP 4,806.67 MM and Grown

In each year in the last three years

MOJO Watch

The company has generated higher cash revenues from business operations

Operating Cash Flows (GBP MM)

Operating Profit

Highest at GBP 1,710.32 MM and Grown

In each period in the last five periods

MOJO Watch

Near term Operating Profit trend is quite positive

Operating Profit (GBP MM)

Dividend per share

Highest at GBP 7.83 and Grown

In each year in the last five years

MOJO Watch

Company is distributing higher dividend from profits generated

DPS (GBP)

Net Sales

Highest at GBP 17,762.73 MM

in the last five periods

MOJO Watch

Near term sales trend is positive

Net Sales (GBP MM)

Pre-Tax Profit

Highest at GBP 1,033.43 MM

in the last five periods

MOJO Watch

Near term Pre-Tax Profit trend is positive

Pre-Tax Profit (GBP MM)

EPS

Highest at GBP 0.43

in the last five periods

MOJO Watch

Increasing profitability; company has created higher earnings for shareholders

EPS (GBP)

Raw Material Cost

Fallen by -3.48% (YoY)

MOJO Watch

The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin

Raw Material Cost as a percentage of Sales

Depreciation

Highest at GBP 529.7 MM

in the last five periods

MOJO Watch

The expenditure on assets done by the company may have gone into operation

Depreciation (GBP MM)

Here's what is not working for Compass Group Plc

Interest Coverage Ratio

Lowest at 1,301.2

in the last five periods

MOJO Watch

The company's ability to manage interest payments is deteriorating

Operating Profit to Interest

Interest

At GBP 131.44 MM has Grown at 27.78%

over previous Semi-Annual period

MOJO Watch

Rising interest cost signifies increased borrowings

Interest Paid (GBP MM)

Debt-Equity Ratio

Highest at 92.79 %

in the last five Semi-Annual periods

MOJO Watch

The company is borrowing more to fund its operations; it's liquidity situation may be stressed

Debt-Equity Ratio