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Downer EDI

ASX:DOW
Snowflake Description

Adequate balance sheet average dividend payer.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
DOW
ASX
A$5B
Market Cap
  1. Home
  2. AU
  3. Commercial Services
Company description

Downer EDI Limited operates as a services provider in Australia, New Zealand, the Asia-Pacific, South America, and Southern Africa. The last earnings update was 85 days ago. More info.


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DOW Share Price and Events
7 Day Returns
1.1%
ASX:DOW
2.2%
AU Commercial Services
0%
AU Market
1 Year Returns
18.8%
ASX:DOW
15%
AU Commercial Services
15.3%
AU Market
DOW Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Downer EDI (DOW) 1.1% -1.1% 10.1% 18.8% 46.9% 88.3%
AU Commercial Services 2.2% 3.1% -1.5% 15% 15.8% 38.7%
AU Market 0% 0.5% 4.7% 15.3% 21.6% 20.7%
1 Year Return vs Industry and Market
  • DOW outperformed the Commercial Services industry which returned 15% over the past year.
  • DOW outperformed the Market in Australia which returned 15.3% over the past year.
Price Volatility
DOW
Industry
5yr Volatility vs Market

Value

 Is Downer EDI undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Downer EDI to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Downer EDI.

ASX:DOW Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 6 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 7.6%
Perpetual Growth Rate 10-Year AU Government Bond Rate 2.3%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for ASX:DOW
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year AU Govt Bond Rate 2.3%
Equity Risk Premium S&P Global 6%
Commercial Services Unlevered Beta Simply Wall St/ S&P Global 0.66
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.659 (1 + (1- 30%) (35.88%))
0.882
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.88
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.31% + (0.882 * 5.96%)
7.57%

Discounted Cash Flow Calculation for ASX:DOW using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Downer EDI is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

ASX:DOW DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (AUD, Millions) Source Present Value
Discounted (@ 7.57%)
2020 79.00 Analyst x1 73.44
2021 340.00 Analyst x1 293.82
2022 387.77 Est @ 14.05% 311.52
2023 428.60 Est @ 10.53% 320.08
2024 463.16 Est @ 8.06% 321.55
2025 492.52 Est @ 6.34% 317.86
2026 517.79 Est @ 5.13% 310.65
2027 539.97 Est @ 4.28% 301.16
2028 559.92 Est @ 3.69% 290.30
2029 578.27 Est @ 3.28% 278.72
Present value of next 10 years cash flows A$2,819.00
ASX:DOW DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= A$578.27 × (1 + 2.31%) ÷ (7.57% – 2.31%)
A$11,249.14
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= A$11,249.14 ÷ (1 + 7.57%)10
A$5,421.87
ASX:DOW Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= A$2,819.00 + A$5,421.87
A$8,240.87
Equity Value per Share
(AUD)
= Total value / Shares Outstanding
= A$8,240.87 / 591.74
A$13.93
ASX:DOW Discount to Share Price
Calculation Result
Value per share (AUD) From above. A$13.93
Current discount Discount to share price of A$8.08
= -1 x (A$8.08 - A$13.93) / A$13.93
42%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Downer EDI is available for.
Intrinsic value
42%
Share price is A$8.08 vs Future cash flow value of A$13.93
Current Discount Checks
For Downer EDI to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Downer EDI's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Downer EDI's share price is below the future cash flow value, and at a substantial discount (> 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Downer EDI's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Downer EDI's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
ASX:DOW PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-06-30) in AUD A$0.43
ASX:DOW Share Price ** ASX (2019-11-15) in AUD A$8.08
Australia Commercial Services Industry PE Ratio Median Figure of 12 Publicly-Listed Commercial Services Companies 18.07x
Australia Market PE Ratio Median Figure of 519 Publicly-Listed Companies 18.45x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Downer EDI.

ASX:DOW PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= ASX:DOW Share Price ÷ EPS (both in AUD)

= 8.08 ÷ 0.43

18.84x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Downer EDI is overvalued based on earnings compared to the AU Commercial Services industry average.
  • Downer EDI is overvalued based on earnings compared to the Australia market.
Price based on expected Growth
Does Downer EDI's expected growth come at a high price?
Raw Data
ASX:DOW PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 18.84x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 6 Analysts
9.5%per year
Australia Commercial Services Industry PEG Ratio Median Figure of 9 Publicly-Listed Commercial Services Companies 2.36x
Australia Market PEG Ratio Median Figure of 346 Publicly-Listed Companies 1.59x

*Line of best fit is calculated by linear regression .

ASX:DOW PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 18.84x ÷ 9.5%

1.99x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Downer EDI is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Downer EDI's assets?
Raw Data
ASX:DOW PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-06-30) in AUD A$4.59
ASX:DOW Share Price * ASX (2019-11-15) in AUD A$8.08
Australia Commercial Services Industry PB Ratio Median Figure of 27 Publicly-Listed Commercial Services Companies 2.46x
Australia Market PB Ratio Median Figure of 1,585 Publicly-Listed Companies 1.71x
ASX:DOW PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= ASX:DOW Share Price ÷ Book Value per Share (both in AUD)

= 8.08 ÷ 4.59

1.76x

* Primary Listing of Downer EDI.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Downer EDI is good value based on assets compared to the AU Commercial Services industry average.
X
Value checks
We assess Downer EDI's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Commercial Services industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Commercial Services industry average (and greater than 0)? (1 check)
  5. Downer EDI has a total score of 3/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Downer EDI expected to perform in the next 1 to 3 years based on estimates from 6 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
9.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Downer EDI expected to grow at an attractive rate?
  • Downer EDI's earnings growth is expected to exceed the low risk savings rate of 2.3%.
Growth vs Market Checks
  • Downer EDI's earnings growth is positive but not above the Australia market average.
  • Downer EDI's revenue growth is positive but not above the Australia market average.
Annual Growth Rates Comparison
Raw Data
ASX:DOW Future Growth Rates Data Sources
Data Point Source Value (per year)
ASX:DOW Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 6 Analysts 9.5%
ASX:DOW Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 6 Analysts 3.6%
Australia Commercial Services Industry Earnings Growth Rate Market Cap Weighted Average 11%
Australia Commercial Services Industry Revenue Growth Rate Market Cap Weighted Average 5.5%
Australia Market Earnings Growth Rate Market Cap Weighted Average 9.8%
Australia Market Revenue Growth Rate Market Cap Weighted Average 3.6%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
ASX:DOW Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below
All numbers in AUD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
ASX:DOW Future Estimates Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-06-30 14,997 1
2022-06-30 14,336 700 336 4
2021-06-30 14,148 719 324 6
2020-06-30 13,793 589 304 6
2019-11-15
ASX:DOW Past Financials Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income *
2019-06-30 12,789 630 254
2019-03-31 12,661 631 231
2018-12-31 12,532 632 209
2018-09-30 12,282 607 136
2018-06-30 12,031 583 63
2018-03-31 10,884 544 74
2017-12-31 9,736 505 84
2017-09-30 8,502 473 128
2017-06-30 7,268 442 173
2017-03-31 7,094 477 175
2016-12-31 6,920 513 178
2016-09-30 6,885 481 174

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Downer EDI's earnings are expected to grow by 9.5% yearly, however this is not considered high growth (20% yearly).
  • Downer EDI's revenue is expected to grow by 3.6% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
ASX:DOW Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (4 months ago) See Below
Future Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below

All data from Downer EDI Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:DOW Future Estimates Data
Date (Data in AUD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-06-30
2022-06-30 0.55 0.59 0.51 2.00
2021-06-30 0.54 0.58 0.48 4.00
2020-06-30 0.51 0.53 0.49 4.00
2019-11-15
ASX:DOW Past Financials Data
Date (Data in AUD Millions) EPS *
2019-06-30 0.43
2019-03-31 0.39
2018-12-31 0.35
2018-09-30 0.23
2018-06-30 0.11
2018-03-31 0.13
2017-12-31 0.15
2017-09-30 0.25
2017-06-30 0.36
2017-03-31 0.37
2016-12-31 0.39
2016-09-30 0.38

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Downer EDI is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Downer EDI's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Australia market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Australia market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Downer EDI has a total score of 1/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Downer EDI performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Downer EDI's growth in the last year to its industry (Commercial Services).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Downer EDI's year on year earnings growth rate was negative over the past 5 years, however the most recent earnings are above average.
  • Downer EDI's 1-year earnings growth exceeds its 5-year average (299.8% vs -4.8%)
  • Downer EDI's earnings growth has exceeded the AU Commercial Services industry average in the past year (299.8% vs 18.9%).
Earnings and Revenue History
Downer EDI's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Downer EDI Company Filings, last reported 4 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:DOW Past Revenue, Cash Flow and Net Income Data
Date (Data in AUD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-06-30 12,789.40 253.50 89.80
2019-03-31 12,660.90 231.05 85.80
2018-12-31 12,532.40 208.60 81.80
2018-09-30 12,281.65 136.00 81.80
2018-06-30 12,030.90 63.40 81.80
2018-03-31 10,883.50 73.65 76.00
2017-12-31 9,736.10 83.90 70.20
2017-09-30 8,501.85 128.40 70.20
2017-06-30 7,267.60 172.90 70.20
2017-03-31 7,093.80 175.25 68.50
2016-12-31 6,920.00 177.60 66.80
2016-09-30 6,885.00 174.30 66.80
2016-06-30 6,850.00 171.00 66.80
2016-03-31 6,878.35 174.20 67.55
2015-12-31 6,906.70 177.40 68.30
2015-09-30 6,963.30 188.45 68.30
2015-06-30 7,019.90 199.50 68.30
2015-03-31 7,005.87 200.62 -24.25
2014-12-31 6,991.85 201.73 -116.80
2014-09-30 7,181.72 204.37 -21.60
2014-06-30 7,371.60 207.00 73.60
2014-03-31 7,689.22 203.85 235.67
2013-12-31 8,006.84 200.70 397.75
2013-09-30 8,391.61 198.50 401.19
2013-06-30 8,776.38 196.30 404.64
2012-12-31 8,825.76 106.38 380.72

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Downer EDI has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Downer EDI used its assets less efficiently than the AU Commercial Services industry average last year based on Return on Assets.
  • Downer EDI's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Downer EDI's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Commercial Services industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Downer EDI has a total score of 2/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Downer EDI's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Downer EDI's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Downer EDI is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Downer EDI's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Downer EDI's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 1.9x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Downer EDI Company Filings, last reported 4 months ago.

ASX:DOW Past Debt and Equity Data
Date (Data in AUD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-06-30 3,050.20 1,705.10 734.60
2019-03-31 3,050.20 1,705.10 734.60
2018-12-31 3,015.30 1,421.90 550.80
2018-09-30 3,015.30 1,421.90 550.80
2018-06-30 3,205.10 1,517.90 616.20
2018-03-31 3,205.10 1,517.90 616.20
2017-12-31 3,206.10 1,484.20 510.30
2017-09-30 3,206.10 1,484.20 510.30
2017-06-30 3,586.50 1,417.30 854.40
2017-03-31 3,586.50 1,417.30 854.40
2016-12-31 2,118.40 615.40 614.50
2016-09-30 2,118.40 615.40 614.50
2016-06-30 2,088.50 624.00 579.20
2016-03-31 2,088.50 624.00 579.20
2015-12-31 2,056.50 637.30 502.30
2015-09-30 2,056.50 637.30 502.30
2015-06-30 2,035.30 493.80 382.00
2015-03-31 2,035.30 493.80 382.00
2014-12-31 1,995.58 564.03 394.24
2014-09-30 1,995.58 564.03 394.24
2014-06-30 1,962.00 398.50 441.80
2014-03-31 1,962.00 398.50 441.80
2013-12-31 1,897.27 412.75 381.49
2013-09-30 1,897.27 412.75 381.49
2013-06-30 1,826.57 589.84 490.52
2012-12-31 1,718.42 416.78 227.17
  • Downer EDI's level of debt (55.9%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (20.4% vs 55.9% today).
  • Debt is well covered by operating cash flow (37%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 5.5x coverage).
X
Financial health checks
We assess Downer EDI's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Downer EDI has a total score of 4/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is Downer EDI's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
3.47%
Current annual income from Downer EDI dividends. Estimated to be 4.15% next year.
If you bought A$2,000 of Downer EDI shares you are expected to receive A$69 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Downer EDI's pays a higher dividend yield than the bottom 25% of dividend payers in Australia (2.36%).
  • Downer EDI's dividend is below the markets top 25% of dividend payers in Australia (5.58%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
ASX:DOW Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 6 Analyst Estimates (S&P Global) See Below
Australia Commercial Services Industry Average Dividend Yield Market Cap Weighted Average of 12 Stocks 2.6%
Australia Market Average Dividend Yield Market Cap Weighted Average of 391 Stocks 4.1%
Australia Minimum Threshold Dividend Yield 10th Percentile 1.5%
Australia Bottom 25% Dividend Yield 25th Percentile 2.4%
Australia Top 25% Dividend Yield 75th Percentile 5.6%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

ASX:DOW Future Dividends Estimate Data
Date (Data in A$) Dividend per Share (annual) Avg. No. Analysts
2023-06-30 0.35 1.00
2022-06-30 0.36 5.00
2021-06-30 0.34 7.00
2020-06-30 0.31 7.00
2019-11-15
ASX:DOW Past Annualized Dividends Data
Date (Data in A$) Dividend per share (annual) Avg. Yield (%)
2019-08-22 0.280 3.542
2019-02-06 0.280 3.788
2018-08-16 0.280 3.949
2018-02-20 0.260 3.766
2017-08-28 0.240 3.519
2017-02-01 0.240 3.763
2016-08-04 0.240 4.295
2016-02-03 0.240 6.502
2015-08-06 0.240 6.890
2015-02-04 0.240 5.200
2014-08-05 0.240 5.352
2014-02-04 0.220 4.495
2013-09-05 0.220 4.594
2013-02-13 0.200 4.726
2012-02-20 0.000 0.000
2011-08-24 0.000 0.000
2011-03-07 0.000 0.000
2011-03-03 0.000 0.000
2010-08-19 0.291 6.486
2010-03-24 0.291 5.629
2009-08-20 0.290 3.458
2009-02-27 0.255 5.079

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been volatile in the past 10 years (annual drop of over 20%).
  • Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of Downer EDI's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.5x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.7x coverage).
X
Income/ dividend checks
We assess Downer EDI's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.5%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Downer EDI afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Downer EDI has a total score of 4/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of Downer EDI's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Grant Fenn
COMPENSATION A$4,727,178
AGE 54
TENURE AS CEO 9.3 years
CEO Bio

Mr. Grant Anthony Fenn, B Ec, CA has been the Chief Executive Officer and Managing Director of Downer EDI Limited since July 30, 2010. Mr. Fenn has over 30 years’ experience in operational management, strategic development and financial management. He held a number of senior roles at Qantas including Executive General Manager of Strategy and Investments and Executive General Manager of Associated Businesses, responsible for the Airports, Freight, Flight Catering and Qantas Holidays businesses. He served as the Chief Financial Officer of Downer EDI Limited from October 2009 to July 2010 and served as its Finance Director from July 1, 2010 to August 2010. He joined Downer in October 2009. He served as an Executive General Manager of Associated Businesses, Deputy Chief Financial Officer, Executive General Manager of Airports and Catering and Executive General Manager of Finance at Qantas Airways Limited and also served as its Executive General Manager of Strategy & Investments from October 2008 to October 1, 2009 and Executive General Manager of Freight Enterprises until October 1, 2008. He served as an Executive General Manager of Qantas Freight Enterprises Ltd. He served as the Chairman of Star Track Express. He serves as an Executive Director of Downer EDI Limited and a Director of Downer Construction (New Zealand) Limited. He is a Non-Executive Director of Sydney Airport Finance Company Pty Ltd. He has been a Non-Executive Director at Southern Cross Airports Corporation Holdings Ltd. since October 01, 2015, Spotless Group Holdings Limited since December 1, 2017 and Sydney Airport Limited since October 1, 2015. He worked at KPMG for eight years before he joined Qantas. He serves as a Non-Executive Director of Sydney Airport Corporation Limited. He has been a Director of Works Finance (NZ) Limited since June 17, 2010. He served as Director of Downer Utilities Australia Pty Ltd. since October 01, 2014. He served as a Director of Australian Air Express. He is a Member of the UTS Engineering and IT Industry Advisory Board. He served as a Director of Downer New Zealand Limited until August 09, 2016, Downer Group Finance Pty Limited until April 27, 2016 and Kdr Victoria Pty Ltd until October 30, 2013. He is a Member of the Australian Institute of Chartered Accountants. Mr. Fenn holds a Bachelor of Economics from Macquarie University.

CEO Compensation
  • Grant's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Grant's remuneration is higher than average for companies of similar size in Australia.
Management Team Tenure

Average tenure of the Downer EDI management team in years:

3.1
Average Tenure
  • The tenure for the Downer EDI management team is about average.
Management Team

Grant Fenn

TITLE
MD, CEO & Director
COMPENSATION
A$5M
AGE
54
TENURE
9.3 yrs

Michael Ferguson

TITLE
Chief Financial Officer
COMPENSATION
A$2M
TENURE
3.1 yrs

Sergio Cinerari

TITLE
Chief Operating Officer of Australian Operations
COMPENSATION
A$3M
TENURE
4.8 yrs

Brendan Petersen

TITLE
Chief Operating Officer of Corporate Services
COMPENSATION
A$2M
TENURE
0.8 yrs

Steve Killeen

TITLE
Chief Executive Officer of New Zealand Business
COMPENSATION
A$2M
TENURE
2.8 yrs

Michael Sharp

TITLE
Group Head of Corporate Affairs & Investors Relations

Robert Regan

TITLE
Group General Counsel & Company Secretary
TENURE
0.8 yrs

Steve Schofield

TITLE
Group Head of Human Resources & Industrial Relations
TENURE
2.3 yrs

David Cattell

TITLE
Group Head of Strategy
COMPENSATION
A$2M
TENURE
4.8 yrs

Julie Wills

TITLE
Group Head of Zero Harm
TENURE
4.8 yrs
Board of Directors Tenure

Average tenure and age of the Downer EDI board of directors in years:

5.6
Average Tenure
63
Average Age
  • The tenure for the Downer EDI board of directors is about average.
Board of Directors

Mike Harding

TITLE
Independent Non Executive Chairman
COMPENSATION
A$411K
AGE
70
TENURE
9 yrs

Grant Fenn

TITLE
MD, CEO & Director
COMPENSATION
A$5M
AGE
54

Teresa Handicott

TITLE
Independent Non-Executive Director
COMPENSATION
A$181K
AGE
56
TENURE
3.2 yrs

Nicole Hollows

TITLE
Independent Non-Executive Director
COMPENSATION
A$179K
AGE
48
TENURE
1.4 yrs

Charles Thorne

TITLE
Independent Non-Executive Director
COMPENSATION
A$197K
AGE
69
TENURE
9.3 yrs

Phil Garling

TITLE
Independent Non-Executive Director
COMPENSATION
A$181K
AGE
65
TENURE
8 yrs

Peter Watson

TITLE
Independent Non-Executive Director
COMPENSATION
A$19K
AGE
63
TENURE
0.5 yrs
Who owns this company?
Recent Insider Trading
  • More shares have been bought than sold by Downer EDI individual insiders in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (A$) Value (A$)
13. Nov 19 Sell Vinva Investment Management Company 16. Oct 19 11. Nov 19 -89,692 A$8.15 A$-731,290
13. Nov 19 Buy Vinva Investment Management Company 16. Oct 19 11. Nov 19 160,211 A$8.20 A$1,314,275
17. Oct 19 Sell Vinva Investment Management Company 28. Aug 19 15. Oct 19 -417,881 A$7.83 A$-3,273,144
17. Oct 19 Buy Vinva Investment Management Company 28. Aug 19 15. Oct 19 400,544 A$7.72 A$3,091,275
06. Oct 19 Sell Dimensional Fund Advisors L.P. Company 25. Sep 19 03. Oct 19 -19,830 A$7.81 A$-152,978
06. Oct 19 Buy Dimensional Fund Advisors L.P. Company 26. Sep 19 01. Oct 19 21,595 A$7.85 A$169,620
26. Sep 19 Sell Dimensional Fund Advisors L.P. Company 15. Jan 19 25. Sep 19 -5,763,240 A$7.68 A$-43,050,337
26. Sep 19 Buy Dimensional Fund Advisors L.P. Company 20. Feb 19 09. Sep 19 310,320 A$8.01 A$2,236,923
29. Aug 19 Sell Vinva Investment Management Company 07. Aug 19 27. Aug 19 -546,875 A$7.51 A$-1,848,476
29. Aug 19 Buy Vinva Investment Management Company 07. Aug 19 27. Aug 19 661,294 A$7.60 A$1,833,025
29. Aug 19 Buy Peter Watson Individual 23. Aug 19 23. Aug 19 6,329 A$7.90 A$49,999
28. Aug 19 Buy Teresa Handicott Individual 23. Aug 19 23. Aug 19 3,000 A$7.89 A$23,670
08. Aug 19 Sell Vinva Investment Management Company 04. May 19 06. Aug 19 -804,412 A$7.23 A$-5,811,883
08. Aug 19 Buy Vinva Investment Management Company 04. May 19 06. Aug 19 1,045,411 A$7.49 A$7,829,869
18. Jul 19 Buy Fil Responsible Entity (Australia) Limited Company 16. Jul 19 16. Jul 19 703,909 A$6.98 A$4,913,989
18. Jul 19 Buy FIL Limited Company 16. Jul 19 16. Jul 19 199,025 A$6.98 A$1,389,394
17. Jul 19 Buy FIL Limited Company 15. Jul 19 15. Jul 19 210,040 A$6.91 A$1,451,964
07. May 19 Sell Vinva Investment Management Company 19. Feb 19 03. May 19 -1,609,884 A$7.62 A$-12,267,516
07. May 19 Buy Vinva Investment Management Company 19. Feb 19 03. May 19 1,892,280 A$7.81 A$14,785,219
09. Apr 19 Sell FIL Limited Company 15. Aug 18 22. Feb 19 -1,117,567 A$7.40 A$0
09. Apr 19 Buy FIL Limited Company 04. May 18 07. Jan 19 4,882,627 A$7.50 A$0
20. Feb 19 Sell Vinva Investment Management Company 08. Feb 19 18. Feb 19 -194,650 A$7.33 A$-1,426,569
20. Feb 19 Buy Vinva Investment Management Company 08. Feb 19 18. Feb 19 21,917 A$7.18 A$157,413
11. Feb 19 Sell New York Life Investment Management LLC Company 17. May 18 07. Feb 19 -6,625,715 A$6.63 A$-43,902,356
11. Feb 19 Buy New York Life Investment Management LLC Company 07. May 18 22. Jan 19 5,614,572 A$7.33 A$41,174,271
11. Feb 19 Sell Vinva Investment Management Company 07. Oct 18 07. Feb 19 -2,728,000 A$6.93 A$-18,906,258
11. Feb 19 Buy Vinva Investment Management Company 07. Oct 18 07. Feb 19 12,458,161 A$6.86 A$85,444,409
15. Jan 19 Sell Nationwide Fund Advisors Company 05. Dec 18 05. Dec 18 -14,837 A$6.27 A$-93,097
15. Jan 19 Sell Columbia Management Investment Advisers, LLC Company 18. Dec 18 18. Dec 18 -79,616 A$6.63 A$-527,460
15. Jan 19 Buy M Fund, Inc. - M International Equity Fund Company 18. Dec 18 18. Dec 18 4,400 A$6.65 A$29,251
15. Jan 19 Sell Dimensional Fund Advisors L.P. Company 09. Dec 15 14. Jan 19 -8,898,857 A$7.44 A$-54,862,174
15. Jan 19 Buy Dimensional Fund Advisors L.P. Company 14. Oct 15 18. Dec 18 7,598,611 A$7.45 A$45,625,936
02. Jan 19 Sell AustralianSuper Pty. Ltd. Company 11. Oct 18 07. Dec 18 -22,524 A$7.21 A$-162,399
02. Jan 19 Buy AustralianSuper Pty. Ltd. Company 09. Oct 18 21. Dec 18 1,961,172 A$7.58 A$14,865,683
16. Dec 18 Sell The Vanguard Group, Inc. Company 15. Aug 18 30. Nov 18 -118,368 A$7.81 A$-923,873
16. Dec 18 Buy The Vanguard Group, Inc. Company 13. Aug 18 12. Dec 18 1,754,915 A$7.94 A$13,934,024
X
Management checks
We assess Downer EDI's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Downer EDI has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Don't Buy Downer EDI Limited (ASX:DOW) For Its Next Dividend Without Doing These Checks

Downer EDI's next dividend payment will be AU$0.14 per share, and in the last 12 months, the company paid a total of AU$0.28 per share. … So we need to check whether the dividend payments are covered, and if earnings are growing. … Downer EDI paid out less in dividends than it reported in profits, but unfortunately it didn't generate enough cash to cover the dividend.

Simply Wall St -

Does Downer EDI Limited (ASX:DOW) Have A Good P/E Ratio?

Downer EDI has a price to earnings ratio of 17.88, based on the last twelve months. … The formula for P/E is: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Downer EDI: P/E of 17.88 = A$7.67 ÷ A$0.43 (Based on the trailing twelve months to June 2019.) Is A High Price-to-Earnings Ratio Good? … How Does Downer EDI's P/E Ratio Compare To Its Peers?

Simply Wall St -

Downer EDI (ASX:DOW) Seems To Use Debt Quite Sensibly

What we care about is avoiding the permanent loss of capital.' It's only natural to consider a company's balance sheet when you examine how risky it is, since debt is often involved when a business collapses. … The first step when considering a company's debt levels is to consider its cash and debt together. … ASX:DOW Historical Debt, August 13th 2019 How Strong Is Downer EDI's Balance Sheet?

Simply Wall St -

An Examination Of Downer EDI Limited (ASX:DOW)

Good value with adequate balance sheet and pays a dividend DOW is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. … According to my intrinsic value of the stock, which is driven by analyst consensus forecast of DOW's earnings, investors now have the opportunity to buy into the stock to reap capital gains. … We aim to bring you long-term focused research analysis driven by fundamental data.

Simply Wall St -

Did Downer EDI Limited (ASX:DOW) Insiders Buy Up More Shares?

Check out our latest analysis for Downer EDI The Last 12 Months Of Insider Transactions At Downer EDI In the last twelve months, the biggest single purchase by an insider was when Independent Non Executive Chairman Richard Harding bought AU$100k worth of shares at a price of AU$6.82 per share. … Happily, we note that in the last year insiders bought 17646 shares for a total of AU$121k. … ASX:DOW Recent Insider Trading, July 24th 2019 Insider Ownership For a common shareholder, it is worth checking how many shares are held by company insiders.

Simply Wall St -

Does Downer EDI Limited's (ASX:DOW) July Stock Price Reflect Its Future Growth?

As the legendary value investor Ben Graham once said, “Price is what you pay, value is what you get.” Downer EDI is trading at price-to-earnings (PE) ratio of 19.57x, which tells us the stock is undervalued based on its latest annual earnings update compared to the Commercial Services average of 20.38x , and overvalued compared to the AU market average ratio of 16.25x. … However, since Downer EDI is a high-growth stock, we must also account for its earnings growth by using calculation called the PEG ratio. … A PE ratio of 19.57x and expected year-on-year earnings growth of 12% give Downer EDI a higher PEG ratio of 1.68x.

Simply Wall St -

A Closer Look At Downer EDI Limited's (ASX:DOW) Uninspiring ROE

The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Downer EDI: 7.6% = AU$209m ÷ AU$3.0b (Based on the trailing twelve months to December 2018.) Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. … Downer EDI's Debt And Its 7.6% ROE While Downer EDI does have some debt, with debt to equity of just 0.48, we wouldn't say debt is excessive. … In my book the highest quality companies have high return on equity, despite low debt.

Simply Wall St -

Do Directors Own Downer EDI Limited (ASX:DOW) Shares?

Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. … See our latest analysis for Downer EDI ASX:DOW Ownership Summary, June 30th 2019 What Does The Institutional Ownership Tell Us About Downer EDI? … Insider Ownership Of Downer EDI The definition of company insiders can be subjective, and does vary between jurisdictions.

Simply Wall St -

What Should We Expect From Downer EDI Limited's (ASX:DOW) Earnings In The Next 12 Months?

Since Downer EDI Limited (ASX:DOW) released its earnings in December 2018, it seems that analyst forecasts are fairly optimistic, with profits predicted to increase by 46% next year compared with the past 5-year average growth rate of -12%. … I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of DOW's earnings growth over these next few years. … ASX:DOW Past and Future Earnings, June 14th 2019 This results in an annual growth rate of 2.6% based on the most recent earnings level of AU$63m to the final forecast of AU$91m by 2022.

Simply Wall St -

Is Downer EDI Limited's (ASX:DOW) CEO Overpaid Relative To Its Peers?

Check out our latest analysis for Downer EDI How Does Grant Fenn's Compensation Compare With Similar Sized Companies? … Thus we can conclude that Grant Fenn receives more in total compensation than the median of a group of companies in the same market, and of similar size to Downer EDI Limited. … We compared the total CEO remuneration paid by Downer EDI Limited, and compared it to remuneration at a group of similar sized companies.

Simply Wall St -

Company Info

Description

Downer EDI Limited operates as a services provider in Australia, New Zealand, the Asia-Pacific, South America, and Southern Africa. Its Transport segment provides road network management and road, asset management, spray sealing, asphalt laying, landfill diversion, and intelligent transport system services; and manufactures bitumen based and asphalt products. This segment also engages in the design and construction of light and heavy rail networks, signaling works, track and station works, and bridges; and provides rail safety technology, fleet maintenance, and asset operation and overhaul services. The company’s Utilities segment plans, designs, constructs, operates, maintains, manages, and decommissions power and gas network assets; provides water and wastewater treatment, and network construction and rehabilitation services; and designs, constructs, and maintains renewable assets in the wind, solar, and power system storage sectors. This segment also offers technology and communications solutions, including design, civil construction, network construction, operation, and maintenance services for fiber, copper, and radio networks. Its Facilities segment offers outsourced facility, catering and laundry, technical and engineering, and maintenance and asset management services, as well as refrigeration solutions. The company’s Engineering, Construction and Maintenance segment provides design, engineering, construction, shutdown, turnaround and outage delivery, operation, maintenance, and ongoing management services for various projects; and designs and manufactures mineral process equipment. Its Mining segment provides resource definition, exploration drilling, and mine feasibility studies; open cut and underground mining services; and drilling, blasting, crushing, asset management, tire management, and mine closure and rehabilitation services, as well as manufactures explosives. The company was incorporated in 1989 and is headquartered in North Ryde, Australia.

Details
Name: Downer EDI Limited
DOW
Exchange: ASX
Founded: 1989
A$4,781,219,454
591,735,081
Website: http://www.downergroup.com
Address: Downer EDI Limited
Triniti Business Campus,
Level 2,
North Ryde,
New South Wales, 2113,
Australia
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
ASX DOW Ordinary Shares Australian Securities Exchange AU AUD 01. Jun 1998
OTCPK DNER.F Ordinary Shares Pink Sheets LLC US USD 01. Jun 1998
DB DNE Ordinary Shares Deutsche Boerse AG DE EUR 01. Jun 1998
CHIA DOW Ordinary Shares Chi-X Australia AU AUD 01. Jun 1998
Number of employees
Current staff
Staff numbers
53,000
Downer EDI employees.
Industry
Diversified Support Services
Commercial Services
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/11/15 10:31
End of day share price update: 2019/11/15 00:00
Last estimates confirmation: 2019/11/10
Last earnings filing: 2019/08/22
Last earnings reported: 2019/06/30
Last annual earnings reported: 2019/06/30


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

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.