Latest news with #Inchcape
The Irish Sun
19-05-2025
- Automotive
- The Irish Sun
Major car dealership to close with ‘job losses' expected in just days – months after brand closed three other sites
A MAJOR car dealership group is to close a site despite announcing hefty profits and a recent dividend payment to shareholders. US-based Group 1 Automotive appears to be taking decisive action after announcing the closure of their Volkswagen Telford dealership - only months after shutting down three other sites. 2 A large VW dealership is set to close - following three other sites Credit: Google 2 However, it will remain as a Volkswagen-authorised repair and service centre Credit: Google According to a report by However, it is understood that the premises will remain operational as a Volkswagen-authorised repair and service centre. Sources within Group 1 have suggested that the company intends to redeploy many affected staff - presumably to other locations. However, Car Dealer Magazine reported that some employees have already started seeking alternative employment, with a number of them marking themselves as 'Open to Work' on LinkedIn. Read more Motors News The firm is reported to be consulting with impacted employees, as they aim to minimise job losses. But with the closure of their sales operations, it is likely that there will be an overall reduction in roles at the site. A spokesperson for Group 1 Automotive UK said: 'Our VW Telford site will continue operating as a standalone VW-authorised repair and service centre, and the retail sales operation will end on 31 May 2025.' This year has been a significant one for Group 1, which announced profits of £162.9m for the first quarter. Most read in Motors As a result, investors are in line to receive a dividend of $0.50 (37p) per a share. The company has already closed Volkswagen Wirral, Volkswagen Cheltenham, and Audi Hyde dealerships, which were previously owned by Inchcape. I drove the Aston Martin Vantage Roadster -it's a car which cries out to be driven hard & will get you a nod of appreciation wherever you go These sites were acquired as part of Group 1's £346m deal to purchase Inchcape's showrooms - effectively doubling the company's presence in the UK. Following the acquisition, Group 1 began a review of its corporate support functions, resulting in several redundancies. A spokesperson commented in November: 'Following the completion of the Inchcape Retail acquisition in August, we commenced a review of our corporate support functions. 'This review remains ongoing to ensure we are in a strong position to serve our customers and OEM partners effectively as we move forward as one enlarged business. 'We continue to support all colleagues as we move through this important transition period.'
Yahoo
19-05-2025
- Business
- Yahoo
An Intrinsic Calculation For Inchcape plc (LON:INCH) Suggests It's 36% Undervalued
The projected fair value for Inchcape is UK£10.84 based on 2 Stage Free Cash Flow to Equity Inchcape's UK£6.98 share price signals that it might be 36% undervalued Our fair value estimate is 15% higher than Inchcape's analyst price target of UK£9.40 Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Inchcape plc (LON:INCH) as an investment opportunity by projecting its future cash flows and then discounting them to today's value. This will be done using the Discounted Cash Flow (DCF) model. Believe it or not, it's not too difficult to follow, as you'll see from our example! Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. If you still have some burning questions about this type of valuation, take a look at the Simply Wall St analysis model. We've discovered 2 warning signs about Inchcape. View them for free. We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, so we need to discount the sum of these future cash flows to arrive at a present value estimate: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (£, Millions) UK£310.2m UK£336.5m UK£350.4m UK£324.6m UK£310.1m UK£302.6m UK£299.5m UK£299.4m UK£301.4m UK£305.0m Growth Rate Estimate Source Analyst x4 Analyst x4 Analyst x4 Est @ -7.37% Est @ -4.47% Est @ -2.44% Est @ -1.02% Est @ -0.02% Est @ 0.68% Est @ 1.16% Present Value (£, Millions) Discounted @ 8.9% UK£285 UK£284 UK£272 UK£231 UK£203 UK£182 UK£165 UK£152 UK£140 UK£131 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = UK£2.0b After calculating the present value of future cash flows in the initial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 5-year average of the 10-year government bond yield of 2.3%. We discount the terminal cash flows to today's value at a cost of equity of 8.9%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = UK£305m× (1 + 2.3%) ÷ (8.9%– 2.3%) = UK£4.8b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= UK£4.8b÷ ( 1 + 8.9%)10= UK£2.0b The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is UK£4.1b. The last step is to then divide the equity value by the number of shares outstanding. Compared to the current share price of UK£7.0, the company appears quite good value at a 36% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Inchcape as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 8.9%, which is based on a levered beta of 1.278. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. See our latest analysis for Inchcape Strength Earnings growth over the past year exceeded the industry. Debt is well covered by earnings and cashflows. Dividends are covered by earnings and cash flows. Weakness Earnings growth over the past year is below its 5-year average. Dividend is low compared to the top 25% of dividend payers in the Retail Distributors market. Opportunity Annual earnings are forecast to grow for the next 3 years. Good value based on P/E ratio and estimated fair value. Significant insider buying over the past 3 months. Threat Annual earnings are forecast to grow slower than the British market. Whilst important, the DCF calculation is only one of many factors that you need to assess for a company. It's not possible to obtain a foolproof valuation with a DCF model. Instead the best use for a DCF model is to test certain assumptions and theories to see if they would lead to the company being undervalued or overvalued. For example, changes in the company's cost of equity or the risk free rate can significantly impact the valuation. What is the reason for the share price sitting below the intrinsic value? For Inchcape, we've put together three essential elements you should look at: Risks: We feel that you should assess the 2 warning signs for Inchcape we've flagged before making an investment in the company. Future Earnings: How does INCH's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. Simply Wall St updates its DCF calculation for every British stock every day, so if you want to find the intrinsic value of any other stock just search here. 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.
Yahoo
27-04-2025
- Business
- Yahoo
Three Days Left Until Inchcape plc (LON:INCH) Trades Ex-Dividend
Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that Inchcape plc (LON:INCH) is about to go ex-dividend in just 3 days. The ex-dividend date is commonly two business days before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. Therefore, if you purchase Inchcape's shares on or after the 1st of May, you won't be eligible to receive the dividend, when it is paid on the 16th of June. The company's next dividend payment will be UK£0.172 per share, and in the last 12 months, the company paid a total of UK£0.28 per share. Based on the last year's worth of payments, Inchcape has a trailing yield of 4.4% on the current stock price of UK£6.50. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether Inchcape can afford its dividend, and if the dividend could grow. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Fortunately Inchcape's payout ratio is modest, at just 43% of profit. A useful secondary check can be to evaluate whether Inchcape generated enough free cash flow to afford its dividend. Fortunately, it paid out only 29% of its free cash flow in the past year. It's positive to see that Inchcape's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut. View our latest analysis for Inchcape Click here to see the company's payout ratio, plus analyst estimates of its future dividends. When earnings decline, dividend companies become much harder to analyse and own safely. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. So we're not too excited that Inchcape's earnings are down 2.4% a year over the past five years. Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, 10 years ago, Inchcape has lifted its dividend by approximately 3.6% a year on average. Should investors buy Inchcape for the upcoming dividend? Inchcape has comfortably low cash and profit payout ratios, which may mean the dividend is sustainable even in the face of a sharp decline in earnings per share. Still, we consider declining earnings to be a warning sign. In summary, it's hard to get excited about Inchcape from a dividend perspective. On that note, you'll want to research what risks Inchcape is facing. In terms of investment risks, we've identified 2 warning signs with Inchcape and understanding them should be part of your investment process. A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks. 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.
Yahoo
27-04-2025
- Business
- Yahoo
Three Days Left Until Inchcape plc (LON:INCH) Trades Ex-Dividend
Some investors rely on dividends for growing their wealth, and if you're one of those dividend sleuths, you might be intrigued to know that Inchcape plc (LON:INCH) is about to go ex-dividend in just 3 days. The ex-dividend date is commonly two business days before the record date, which is the cut-off date for shareholders to be present on the company's books to be eligible for a dividend payment. The ex-dividend date is important as the process of settlement involves at least two full business days. So if you miss that date, you would not show up on the company's books on the record date. Therefore, if you purchase Inchcape's shares on or after the 1st of May, you won't be eligible to receive the dividend, when it is paid on the 16th of June. The company's next dividend payment will be UK£0.172 per share, and in the last 12 months, the company paid a total of UK£0.28 per share. Based on the last year's worth of payments, Inchcape has a trailing yield of 4.4% on the current stock price of UK£6.50. Dividends are an important source of income to many shareholders, but the health of the business is crucial to maintaining those dividends. So we need to investigate whether Inchcape can afford its dividend, and if the dividend could grow. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. Dividends are typically paid from company earnings. If a company pays more in dividends than it earned in profit, then the dividend could be unsustainable. Fortunately Inchcape's payout ratio is modest, at just 43% of profit. A useful secondary check can be to evaluate whether Inchcape generated enough free cash flow to afford its dividend. Fortunately, it paid out only 29% of its free cash flow in the past year. It's positive to see that Inchcape's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut. View our latest analysis for Inchcape Click here to see the company's payout ratio, plus analyst estimates of its future dividends. When earnings decline, dividend companies become much harder to analyse and own safely. If business enters a downturn and the dividend is cut, the company could see its value fall precipitously. So we're not too excited that Inchcape's earnings are down 2.4% a year over the past five years. Another key way to measure a company's dividend prospects is by measuring its historical rate of dividend growth. Since the start of our data, 10 years ago, Inchcape has lifted its dividend by approximately 3.6% a year on average. Should investors buy Inchcape for the upcoming dividend? Inchcape has comfortably low cash and profit payout ratios, which may mean the dividend is sustainable even in the face of a sharp decline in earnings per share. Still, we consider declining earnings to be a warning sign. In summary, it's hard to get excited about Inchcape from a dividend perspective. On that note, you'll want to research what risks Inchcape is facing. In terms of investment risks, we've identified 2 warning signs with Inchcape and understanding them should be part of your investment process. A common investing mistake is buying the first interesting stock you see. Here you can find a full list of high-yield dividend stocks. 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. Sign in to access your portfolio
Scottish Sun
26-04-2025
- Automotive
- Scottish Sun
Major car UK dealership closes as US giant makes ‘drastic cutbacks' with hundreds more jobs at risk across the country
Following confirmation of a mega deal, around 370 jobs could be lost STALLED ENGINE Major car UK dealership closes as US giant makes 'drastic cutbacks' with hundreds more jobs at risk across the country A MAJOR UK car dealership has closed as a US giant makes "drastic cutbacks" with hundreds of jobs at risk across the country. As part of a £346 million deal, US-based Group 1 is restructuring its UK business. Advertisement 2 Group1 Automotive has closed its Wirral Volkswagen dealership Credit: Google Streetview Staff at three UK Volkswagen sites previously said they learned of the "drastic cutbacks" and sites to be axed back in February. Now, the Volkswagen dealership on Pool Lane in Bromborough, Wirral, has closed down. It stopped trading on March 31, a spokesperson confirmed. Group 1 acquired the Volkswagen Wirral, Volkswagen Cheltenham, and Audi Hyde sites to buy Inchcape's UK dealerships last summer. Advertisement By doing so, it effectively doubled its own footprint on this side of the Atlantic. Since then, the American firm is said to have been "knee deep" in drastic cutsbacks. A Volkswagen spokesperson told the Globe: 'We can confirm that Group 1 Volkswagen Wirral ceased trading at the end of March and is now closed. 'Our focus when any network changes take place remains on convenience and the highest levels of service. Advertisement 'Customers have been contacted to advise them of alternative sales, service and parts facilities.' It comes as 370 jobs could be lost as part of Group 1's mega deal, AMOnline reports. Rob Gill takes VW's latest 7-seat SUV for a spin, the Tayron The top 10 AM100 company announced its latest plans to investors in the US as part of an analyst day presentation on February 13. The business said the timing of the latest redundancies would be made between the end of the March-plate change in the UK and the end of June. Advertisement Approximately 2,500 people moved across from Inchcape to Group 1. The combined UK business has around 7,000 employees and the potential loss of 644 roles would amount to an almost 10% reduction in headcount. A Group 1 spokesperson said: "Following the completion of the Inchcape Retail acquisition in August 2024 we commenced a review of our corporate support functions, which remains ongoing, to ensure that we remain in a strong position to serve our customers and OEM partners effectively. "We have spoken directly with all the teams impacted, and our focus remains on supporting our colleagues by working closely with them during this transition. Advertisement 'In line with other retailers, we continue to face cost headwinds relating to tax increases announced in the last Budget, and in response we have identified opportunities to remove duplication, streamline processes and decentralise certain roles to drive efficiencies across the business." The dealer group said it is looking to drive growth through integrating and optimising its existing business.
