reports
- Carl Smith
- Mike Allen
Zeus: Automotive Retail sector analysis - April 2023
This report provides an updated view on the key themes facing the motor retail sector in 2023. On page 4 we discuss the conclusions of our July 2022 research and compare them to what happened in H2 2022. It is clear that many of the same themes (supply shortages, high inflation, sector consolidation, etc.) still apply – here we discuss how these themes have evolved.
- Mike Allen
Audio Note: Lookers - FY22 results & upgrade
In this audio note, Zeus’ Mike Allen summarises the investment case for Lookers. Lookers FY22 results were 1.1% ahead of our forecasts at the adj. PBT level showing good underlying growth on the prior year after adjusting for COVID support received in FY21. Listen to the audio note below, and read the full research here.
- Liberum Research Team
- Liberum Research Team
- Alex O’Hanlon
- Joe Brent
- Sanjay Vidyarthi
LIBERUM: Lookers - Strong start to FY23E drives upgrades
Lookers delivered a series of upgrades through 2022 and has continued this trend into 2023. On the back of a strong Q1, we increase our FY23E adj. PBT by 21% which is likely to position us at the top end of consensus. Despite this, we think there will be further scope for upgrades through the year, given supportive market conditions and plenty of self-help levers to pull. The strong net cash balance sheet supports investment in the business as well as in-fill acquisitions. A CY23E PE of 5.9x is ...
- Liberum Research Team
- Liberum Research Team
- Carl Smith
- Mike Allen
Lookers (LOOK LN) -FY 22 results & upgrade
Lookers FY22 results were 1.1% ahead of our forecasts at the adj. PBT level showing good underlying growth on the prior year after adjusting for COVID support received in FY21. The Group made decent progress both operationally and strategically and now has a strong and well capitalised platform to support future growth. We upgrade our forecasts in line with guidance and reiterate our view that the shares remain materially undervalued.
- Mike Allen
Audio Note: Lookers - Near record underlying PBT expected
In this audio note, Zeus’ Mike Allen summarises the investment case for Lookers. Lookers has released a trading update for the year to 31 December 2022 showing stronger than expected Q4 trading. Listen to the audio note below, and read the full research here.
- Mike Allen
Lookers plc (LOOK LN) - Near record underlying PBT expected
Lookers has released a trading update for the year to 31 December 2022 showing stronger than expected Q4 trading. Underlying PBT guidance for FY22 is increased to “greater than £80m”, so we upgrade our forecast by 9.1% from £75.6m to £82.5m. This would exceed the record FY21 PBT of £90.1m (£90.7m excl. SBP) after adjusting for £9.8m of Covid-19 support, which is an impressive result in light of the vehicle supply challenges and high UK inflation seen in 2022. On a FY22 P/E of 4.6x with cash and ...
- Mike Allen
- Toby Thorrington
Lookers - Termination of coverage
Edison Investment Research is terminating coverage on SandpiperCl (SANDPI), Mirriad Advertising (MIRI), Trackwise Designs (TWD), Lookers (LOOK) and BerGenBio (BGBIO). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.
- Mike Allen
Zeus Audio Note: Lookers - Strong underlying growth
In this audio note, Zeus’ Mike Allen summarises the investment case for Lookers. Lookers’ H1 results show a strong performance against a backdrop of severe vehicle supply disruption. Listen to the audio note below, and read the full research here: /zeus-research-portal/#/portal/zeus-capital/research/bb45c7b3-b9ce-4204-be18-01723083a963 Listen to all episodes of the Zeus Research team Audio Notes here: /h75jn5e_rb/ This content is issued by Zeus Capital Limited (“Zeus”) (Incorporated in Engl...
- Carl Smith
- Mike Allen
Lookers plc (LOOK LN) - Strong underlying growth
Lookers’ H1 results show a strong performance against a backdrop of severe vehicle supply disruption. H1 revenue increased 3.6% to £2,230m and gross profit increased 9.8% to £282.8m, driven by both market tailwinds and ‘self-help’ operational improvements. Underlying PBT was £47.2m, above the c. £45m flagged in the 29 June trading update, but lower than the £50.0m in H1 2021. However, the prior period benefitted from £12.7m of government support, suggesting the implied base is c. £37m. There is ...
- Mike Allen
Zeus: Automotive Retail sector analysis - July 2022
As we pass the half point of the year, we take a temperature check of the UK Automotive Retail sector, looking at the key themes and how these impact the PLC dealers. The sector showed exceptional resilience and flexibility in the pandemic, followed by very strong trading in 2021. We expect that dealers will once again prove resilient to supply constraints and macro uncertainties.
- Toby Thorrington
Lookers - Smoothing out the bumps
Lookers continues to perform robustly as the UK car market faces supply constraints for both new and used vehicles. While volumes are down, used prices are strongly ahead year-on-year despite plateauing in H122. As a result, Lookers expects £45m of underlying PBT in H122, ahead of its expectations. Conditions may moderate further in H222, but management still expects FY22 to be ahead of its previous expectations. We have increased our FY22 underlying PBT by 17% to £62m, while maintaining our FY2...
- Mike Allen
Lookers plc (LOOK LN) - Trading momentum continues
Lookers has released an H1 trading update reporting a continuation of strong performance year to date. H1 2022 underlying PBT is expected to be c. £45m and Management anticipate full year PBT will also be ahead of prior expectations. We therefore increase our FY22 underlying PBT forecast by 18.7% to £63.0m, with the view that profits will be heavily H1-weighted this year because of the intensifying squeeze on UK consumer spending power. On our forecasts, Lookers now trades at 5.7x FY22 P/E, whic...
- Toby Thorrington
Lookers - Record FY21, but challenges remain
Lookers’ FY21 adjusted PBT was even more of a record than we had anticipated. Revenue growth in all the main segments was augmented by strong used car margins and improvements in the new car segment, which drove group gross margins up 180bp to an exceptional 12.8%. The positive demand and supply dynamics look set to continue for the time being. Used car prices may stay high for some time but as they plateau margins may moderate, compounded by inflationary cost factors. In addition, high energy p...
- Mike Allen
- Rachel Birkett
Lookers plc (LOOK LN)
Lookers has announced FY21 results that show record underlying PBT of £90.7m, 5.3% above our forecast of £86.2m. The outlook is suitably cautious given current supply constraints and likely impact of inflation on future consumer demand. However, Q1 2022 has started well and trading is ahead of the prior year. We make no changes to underlying PBT forecasts at this time, but maintain our view that Lookers remains significantly undervalued along with the rest of the sector.
LOOKERS sees an upgrade to Slightly Positive due to a better fundament...
The general evaluation of LOOKERS (GB), a company active in the Auto Parts industry, has been upgraded by the independent financial analyst theScreener with the addition of a star. Its fundamental valuation now shows 2 out of 4 possible stars while its market behaviour can be considered as defensive. theScreener believes that the additional star(s) merits the upgrade of its general evaluation to Slightly Positive. As of the analysis date March 22, 2022, the closing price was GBp 95.10 and its po...
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