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Yahoo
23-05-2025
- Business
- Yahoo
Is Generation Development Group Limited's (ASX:GDG) Recent Performance Tethered To Its Attractive Financial Prospects?
Generation Development Group's (ASX:GDG) stock up by 2.4% over the past week. Given its impressive performance, we decided to study the company's key financial indicators as a company's long-term fundamentals usually dictate market outcomes. Specifically, we decided to study Generation Development Group's ROE in this article. Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. Simply put, it is used to assess the profitability of a company in relation to its equity capital. Our free stock report includes 2 warning signs investors should be aware of before investing in Generation Development Group. Read for free now. The formula for ROE is: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for Generation Development Group is: 23% = AU$80m ÷ AU$346m (Based on the trailing twelve months to December 2024). The 'return' is the amount earned after tax over the last twelve months. Another way to think of that is that for every A$1 worth of equity, the company was able to earn A$0.23 in profit. Check out our latest analysis for Generation Development Group So far, we've learned that ROE is a measure of a company's profitability. We now need to evaluate how much profit the company reinvests or "retains" for future growth which then gives us an idea about the growth potential of the company. Assuming everything else remains unchanged, the higher the ROE and profit retention, the higher the growth rate of a company compared to companies that don't necessarily bear these characteristics. First thing first, we like that Generation Development Group has an impressive ROE. Secondly, even when compared to the industry average of 16% the company's ROE is quite impressive. So, the substantial 80% net income growth seen by Generation Development Group over the past five years isn't overly surprising. As a next step, we compared Generation Development Group's net income growth with the industry, and pleasingly, we found that the growth seen by the company is higher than the average industry growth of 19%. Earnings growth is an important metric to consider when valuing a stock. It's important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. One good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings prospects. So, you may want to check if Generation Development Group is trading on a high P/E or a low P/E, relative to its industry. Generation Development Group's significant three-year median payout ratio of 84% (where it is retaining only 16% of its income) suggests that the company has been able to achieve a high growth in earnings despite returning most of its income to shareholders. Moreover, Generation Development Group is determined to keep sharing its profits with shareholders which we infer from its long history of paying a dividend for at least ten years. Upon studying the latest analysts' consensus data, we found that the company's future payout ratio is expected to drop to 44% over the next three years. Still forecasts suggest that Generation Development Group's future ROE will drop to 8.5% even though the the company's payout ratio is expected to decrease. This suggests that there could be other factors could driving the anticipated decline in the company's ROE. In total, we are pretty happy with Generation Development Group's performance. We are particularly impressed by the considerable earnings growth posted by the company, which was likely backed by its high ROE. While the company is paying out most of its earnings as dividends, it has been able to grow its earnings in spite of it, so that's probably a good sign. Having said that, on studying current analyst estimates, we were concerned to see that while the company has grown its earnings in the past, analysts expect its earnings to shrink in the future. Are these analysts expectations based on the broad expectations for the industry, or on the company's fundamentals? Click here to be taken to our analyst's forecasts page for the company. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Irish Daily Mirror
09-05-2025
- Business
- Irish Daily Mirror
Uisce Eireann chief says planning objections costing State 'billions'
Planning objections to major projects are costing the State and taxpayers 'billions' of euro, the CEO of Uisce Éireann has warned. Niall Gleeson stated that there is a 'cohort of people in this country who don't want to build anything', as he warned of a new phenomenon called 'bananas' – 'Build absolutely nothing anywhere near anything'. He made the remarks at the opening of a new wastewater treatment plan in Arklow, Co Wicklow, which was also attended by Taoiseach Micheál Martin and Housing Minister James Browne. During his speech, Mr Gleeson spoke about how planning permission was launched for the Arklow wastewater treatment plant and the Greater Dublin Drainage Project (GDG) at the same time. GDG still has not been completed due to objections and planning delays, while the Arklow site was opened on Friday. Mr Gleeson said there is 'something wrong with the system if that can happen'. If the Dublin project had been built at the time, the cost would have been €600 million, but Mr Gleeson fears it could be in the region of €1.2 billion now due to inflation and delays. He said: 'We have a cohort of people in this country who don't want to build anything and they are holding up processes on the basis of being environmental crusaders. 'But actually, the people in this tent are the environmentalists, the people who campaigned for the project, the people who provide the funding, the people who did the design, did the build and now operate the plant. 'We need to work on the objectors. They're not really helping the environment. 'They're just costing the taxpayer hundreds of millions and they're stopping our children from getting homes.' Speaking to reporters after his speech, Mr Gleeson projected that planning objections that lead to delays are causing prices to rise and costing the State more money in the long term. He said: 'I would say that if you took it, the taxpayer and the State, it is probably in the billions [that is being lost]. 'Private entities are losing a fortune through this kind of stuff as well. 'I know there's a lot of work being done on the planning process and, actually, a lot of the planning process works pretty well with the local authorities and An Bórd Pleanála, 'But it's the ones that are tricky to get through, the larger projects, that I think we need extra support. But that cost is real.' Mr Gleeson said that he knows we live in a 'democratic society' and there are 'processes' in place for objecting to projects. However, he suggested that 'people are using the judicial review system where they don't like the answer from An Bórd Pleanála. He added: 'I don't think that's working for the State. I don't think the common good is being delivered.' When Mr Gleeson's concerns were put to the Taoiseach, he said 'we are in a democratic society' and 'always welcome consultations and inputs from local communities and from people in terms of any major piece of infrastructure'. He also stated that new planning laws and the establishment of a new Planning Commission 'will help in that regard'. This week, questions were raised about whether €1 billion in funding announced in Budget 2026 was actually additional funding. Mr Gleeson said that Uisce Éireann wrote to then-Housing Minister Darragh O'Brien seeking 'clarification on the extra €1billion' and that they received an answer they were 'satisfied with'. He stated that the body had sought €10.2 billion over the next five years as part of the strategic funding plan. Following the decision to increase housing targets, they have now sought an extra €2 billion. He added: 'I think we would say that we're happy with the funding that we're getting at the moment.'
