Edison Investment Research - Logistics Development Group (LDG) Eddie Stobart Logistics - An attractive dividend yield with growth

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Edison Investment Research

Eddie Stobart Logistics - An attractive dividend yield with growth

Recent strategic acquisitions have transformed Eddie Stobart Logistics (ESL) into a full end-to-end logistics provider. This strategy has resulted in strong FY18 revenue (+35% y-o-y, of which +18% y-o-y organic growth) and earnings growth (EBIT +14% and EPS +15%), reflecting the strength of its pay-as-you-go model and its ability to achieve synergies. We expect ESL to focus on margin improvement and cash flow generation in FY19, and now forecast a 13% EPS CAGR in FY18â€“20. Following recent share price weakness, the stock offers a 6.4% dividend yield for FY18 with a 5% CAGR in FY18â€“20, on our updated estimates. ESL continues to trade at a large discount to logistics companies in the UK and Europe on P/E multiples.

29/03/2019 7 EN

Underlying

Logistics Development Group

Eddie Stobart is a logistics and supply chain organization in the UK. From its headquarters in Warrington, operating 2,200 vehicles, 3,800 trailers and 24 distribution centres throughout the UK and Europe. Co. operates its business across the following core sectors: E-Commerce - covering online retailers and omni-channel retailers; Manufacturing, Industrial & Bulk - includes movement of raw materials and components used in manufacturing processes; Consumer includes the movement of manufactured products; and Retail covers the retail supply chain, operating from either a retailer's supplier or a retailer's own distribution centers, from where goods are transported to a retailer's outlets.

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GB00BD8QVC95 London Stock Exchange United Kingdom

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Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Eddie Stobart Logistics - An attractive dividend yield with growth

Rapid recovery in revenues and margins

A logical deal that is EPS accretive

Back to basics is paying off

Basilea Pharmaceutica - Cresemba milestone payments continue to roll in

AAC Clyde Space - Solid start to the year with further order growth

Tinexta - Typical seasonality in Q124

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