| United Internet AG NA (DE0005089031) | |||
23,90 EURStand (close): 01.07.25 |
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| 08.04.25 12:50:14 | United Internet's (ETR:UTDI) Dividend Will Be Increased To €1.90 |  |
| The board of United Internet AG (ETR:UTDI) has announced that it will be paying its dividend of €1.90 on the 20th of May, an increased payment from last year's comparable dividend. This takes the annual payment to 2.4% of the current stock price, which is about average for the industry. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. United Internet's Projections Indicate Future Payments May Be Unsustainable Estimates Indicate United Internet's Could Struggle to Maintain Dividend Payments In The Future United Internet's Future Dividends May Potentially Be At Risk Solid dividend yields are great, but they only really help us if the payment is sustainable. United Internet is not generating a profit, but its free cash flows easily cover the dividend, leaving plenty for reinvestment in the business. We generally think that cash flow is more important than accounting measures of profit, so we are fairly comfortable with the dividend at this level. EPS is forecast to rise very quickly over the next 12 months. If recent patterns in the dividend continues, we would start to get a bit worried, with the payout ratio possibly reaching 380%.XTRA:UTDI Historic Dividend April 8th 2025 See our latest analysis for United Internet Dividend Volatility While the company has been paying a dividend for a long time, it has cut the dividend at least once in the last 10 years. Since 2015, the annual payment back then was €0.60, compared to the most recent full-year payment of €0.40. This works out to be a decline of approximately 4.0% per year over that time. A company that decreases its dividend over time generally isn't what we are looking for. Dividend Growth Potential Is Shaky Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. United Internet's EPS has fallen by approximately 23% per year during the past five years. This steep decline can indicate that the business is going through a tough time, which could constrain its ability to pay a larger dividend each year in the future. It's not all bad news though, as the earnings are predicted to rise over the next 12 months - we would just be a bit cautious until this becomes a long term trend. The Dividend Could Prove To Be Unreliable Overall, this is probably not a great income stock, even though the dividend is being raised at the moment. The payments haven't been particularly stable and we don't see huge growth potential, but with the dividend well covered by cash flows it could prove to be reliable over the short term. Overall, we don't think this company has the makings of a good income stock. Story Continues Market movements attest to how highly valued a consistent dividend policy is compared to one which is more unpredictable. However, there are other things to consider for investors when analysing stock performance. For example, we've picked out 2 warning signs for United Internet that investors should know about before committing capital to this stock. Looking for more high-yielding dividend ideas? Try our collection of strong dividend payers. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View Comments |
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| 29.03.25 06:51:23 | United Internet Full Year 2024 Earnings: EPS Misses Expectations | |
| United Internet (ETR:UTDI) Full Year 2024 Results Key Financial Results Revenue: €6.33b (up 1.9% from FY 2023). Net loss: €47.6m (down by 120% from €232.7m profit in FY 2023). €0.28 loss per share (down from €1.35 profit in FY 2023). The end of cancer? These 15 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.XTRA:UTDI Earnings and Revenue Growth March 29th 2025 All figures shown in the chart above are for the trailing 12 month (TTM) period United Internet EPS Misses Expectations Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates. Looking ahead, revenue is forecast to grow 3.9% p.a. on average during the next 3 years, compared to a 2.9% growth forecast for the Telecom industry in Germany. Performance of the German Telecom industry. The company's shares are up 4.2% from a week ago. Risk Analysis You should always think about risks. Case in point, we've spotted 2 warning signs for United Internet you should be aware of. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View Comments |
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| 07.03.25 09:58:57 | United Internet (ETR:UTDI) shareholders are up 6.7% this past week, but still in the red over the last three years |  |
| United Internet AG (ETR:UTDI) shareholders should be happy to see the share price up 19% in the last month. But that doesn't change the fact that the returns over the last three years have been less than pleasing. After all, the share price is down 33% in the last three years, significantly under-performing the market. Although the past week has been more reassuring for shareholders, they're still in the red over the last three years, so let's see if the underlying business has been responsible for the decline. Check out our latest analysis for United Internet While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. United Internet saw its share price decline over the three years in which its EPS also dropped, falling to a loss. This was, in part, due to extraordinary items impacting earnings. Since the company has fallen to a loss making position, it's hard to compare the change in EPS with the share price change. But it's safe to say we'd generally expect the share price to be lower as a result! The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).XTRA:UTDI Earnings Per Share Growth March 7th 2025 It might be well worthwhile taking a look at our freereport on United Internet's earnings, revenue and cash flow. What About Dividends? When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for United Internet the TSR over the last 3 years was -28%, which is better than the share price return mentioned above. And there's no prize for guessing that the dividend payments largely explain the divergence! A Different Perspective While the broader market gained around 22% in the last year, United Internet shareholders lost 15% (even including dividends). However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 0.8% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Take risks, for example - United Internet has 2 warning signs (and 1 which is a bit unpleasant) we think you should know about. Story Continues If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this freelist of companies that have proven they can grow earnings. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on German exchanges. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View Comments |
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| 02.02.25 07:15:47 | The recent 7.0% gain must have brightened CEO Ralph Dommermuth's week, United Internet AG's (ETR:UTDI) most bullish insider | |
| Key Insights Insiders appear to have a vested interest in United Internet's growth, as seen by their sizeable ownership Ralph Dommermuth owns 54% of the company Institutional ownership in United Internet is 23% A look at the shareholders of United Internet AG (ETR:UTDI) can tell us which group is most powerful. With 54% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company. Clearly, insiders benefitted the most after the company's market cap rose by €183m last week. Let's delve deeper into each type of owner of United Internet, beginning with the chart below. See our latest analysis for United Internet XTRA:UTDI Ownership Breakdown February 2nd 2025 What Does The Institutional Ownership Tell Us About United Internet? Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. United Internet already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at United Internet's earnings history below. Of course, the future is what really matters.XTRA:UTDI Earnings and Revenue Growth February 2nd 2025 Our data indicates that hedge funds own 6.7% of United Internet. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. With a 54% stake, CEO Ralph Dommermuth is the largest shareholder. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. For context, the second largest shareholder holds about 6.7% of the shares outstanding, followed by an ownership of 5.5% by the third-largest shareholder. While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too. Story Continues Insider Ownership Of United Internet The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. Our most recent data indicates that insiders own the majority of United Internet AG. This means they can collectively make decisions for the company. Insiders own €1.5b worth of shares in the €2.8b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake. General Public Ownership The general public-- including retail investors -- own 16% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. Next Steps: It's always worth thinking about the different groups who own shares in a company. But to understand United Internet better, we need to consider many other factors. For instance, we've identified 2 warning signs for United Internet (1 can't be ignored) that you should be aware of. If you would prefer discover what analysts are predicting in terms of future growth, do not miss this freereport on analyst forecasts. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View Comments |
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| 28.09.24 06:46:56 | United Internet (ETR:UTDI) investors are sitting on a loss of 39% if they invested five years ago | |
| The main aim of stock picking is to find the market-beating stocks. But every investor is virtually certain to have both over-performing and under-performing stocks. At this point some shareholders may be questioning their investment in United Internet AG (ETR:UTDI), since the last five years saw the share price fall 45%. With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies. Check out our latest analysis for United Internet To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. Looking back five years, both United Internet's share price and EPS declined; the latter at a rate of 30% per year. This fall in the EPS is worse than the 11% compound annual share price fall. So the market may previously have expected a drop, or else it expects the situation will improve. The high P/E ratio of 125.02 suggests that shareholders believe earnings will grow in the years ahead. The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image). earnings-per-share-growth Dive deeper into United Internet's key metrics by checking this interactive graph of United Internet's earnings, revenue and cash flow. What About Dividends? As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, United Internet's TSR for the last 5 years was -39%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence! A Different Perspective Investors in United Internet had a tough year, with a total loss of 6.5% (including dividends), against a market gain of about 17%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. However, the loss over the last year isn't as bad as the 7% per annum loss investors have suffered over the last half decade. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. It's always interesting to track share price performance over the longer term. But to understand United Internet better, we need to consider many other factors. Even so, be aware that United Internet is showing 3 warning signs in our investment analysis, and 1 of those is significant... Story continues Of course United Internet may not be the best stock to buy. So you may wish to see this freecollection of growth stocks. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on German exchanges. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View comments |
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| 25.08.24 08:51:58 | Ralph Dommermuth United Internet AG's (ETR:UTDI) CEO is the most bullish insider, and their stock value gained 4.1%last week | |
| Key Insights United Internet's significant insider ownership suggests inherent interests in company's expansion The largest shareholder of the company is Ralph Dommermuth with a 54% stake 24% of United Internet is held by Institutions Every investor in United Internet AG (ETR:UTDI) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 54% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company. As a result, insiders scored the highest last week as the company hit €3.3b market cap following a 4.1% gain in the stock. In the chart below, we zoom in on the different ownership groups of United Internet. See our latest analysis for United Internet ownership-breakdown What Does The Institutional Ownership Tell Us About United Internet? Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. As you can see, institutional investors have a fair amount of stake in United Internet. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see United Internet's historic earnings and revenue below, but keep in mind there's always more to the story. earnings-and-revenue-growth United Internet is not owned by hedge funds. The company's CEO Ralph Dommermuth is the largest shareholder with 54% of shares outstanding. This implies that they possess majority interests and have significant control over the company. Investors usually consider it a good sign when the company leadership has such a significant stake, as this is widely perceived to increase the chance that the management will act in the best interests of the company. With 5.5% and 3.3% of the shares outstanding respectively, Bank of America Corporation, Asset Management Arm and Wellington Management Group LLP are the second and third largest shareholders. While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future. Story continues Insider Ownership Of United Internet While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. It seems that insiders own more than half the United Internet AG stock. This gives them a lot of power. That means insiders have a very meaningful €1.8b stake in this €3.3b business. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares. General Public Ownership The general public, who are usually individual investors, hold a 22% stake in United Internet. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. Next Steps: It's always worth thinking about the different groups who own shares in a company. But to understand United Internet better, we need to consider many other factors. Take risks for example - United Internet has 3 warning signs (and 1 which is significant) we think you should know about. Ultimately the future is most important. You can access this freereport on analyst forecasts for the company. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View comments |
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| 28.06.24 06:00:57 | United Internet AG (ETR:UTDI) Shares Could Be 31% Above Their Intrinsic Value Estimate | |
| Key Insights United Internet's estimated fair value is €15.22 based on Dividend Discount Model Current share price of €20.00 suggests United Internet is potentially 31% overvalued Our fair value estimate is 47% lower than United Internet's analyst price target of €28.85 Does the June share price for United Internet AG (ETR:UTDI) reflect what it's really worth? Today, we will estimate the stock's intrinsic value by taking the expected future cash flows and discounting them to their present value. The Discounted Cash Flow (DCF) model is the tool we will apply to do this. Before you think you won't be able to understand it, just read on! It's actually much less complex than you'd imagine. We would caution that there are many ways of valuing a company and, like the DCF, each technique has advantages and disadvantages in certain scenarios. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in the Simply Wall St analysis model. See our latest analysis for United Internet Crunching The Numbers As United Internet operates in the telecom sector, we need to calculate the intrinsic value slightly differently. Instead of using free cash flows, which are hard to estimate and often not reported by analysts in this industry, dividends per share (DPS) payments are used. Unless a company pays out the majority of its FCF as a dividend, this method will typically underestimate the value of the stock. We use the Gordon Growth Model, which assumes dividend will grow into perpetuity at a rate that can be sustained. The dividend is expected to grow at an annual growth rate equal to the 5-year average of the 10-year government bond yield of 0.7%. We then discount this figure to today's value at a cost of equity of 4.4%. Relative to the current share price of €20.0, the company appears reasonably expensive at the time of writing. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. Value Per Share = Expected Dividend Per Share / (Discount Rate - Perpetual Growth Rate) = €0.6 / (4.4% – 0.7%) = €15.2 dcf The Assumptions Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own 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 United Internet 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 4.4%, which is based on a levered beta of 0.800. 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. Story continues SWOT Analysis for United Internet Strength Debt is well covered by earnings and cashflows. Weakness Earnings declined over the past year. Dividend is low compared to the top 25% of dividend payers in the Telecom market. Opportunity Annual earnings are forecast to grow faster than the German market. Good value based on P/E ratio compared to estimated Fair P/E ratio. Threat Paying a dividend but company has no free cash flows. Annual revenue is forecast to grow slower than the German market. Looking Ahead: Although the valuation of a company is important, it shouldn't be the only metric you look at when researching a company. It's not possible to obtain a foolproof valuation with a DCF model. Preferably you'd apply different cases and assumptions and see how they would impact the company's valuation. If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. Can we work out why the company is trading at a premium to intrinsic value? For United Internet, we've put together three further items you should look at: Risks: Be aware that United Internet is showing 3 warning signs in our investment analysis, you should know about... Future Earnings: How does UTDI'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 Solid Businesses: Low debt, high returns on equity and good past performance are fundamental to a strong business. Why not explore our interactive list of stocks with solid business fundamentals to see if there are other companies you may not have considered! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the XTRA every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com View comments |
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| 07.06.24 08:32:37 | United Internet (ETR:UTDI) May Have Issues Allocating Its Capital | |
| If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? In a perfect world, we'd like to see a company investing more capital into its business and ideally the returns earned from that capital are also increasing. Ultimately, this demonstrates that it's a business that is reinvesting profits at increasing rates of return. Although, when we looked at United Internet (ETR:UTDI), it didn't seem to tick all of these boxes. Understanding Return On Capital Employed (ROCE) Just to clarify if you're unsure, ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. The formula for this calculation on United Internet is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.079 = €755m ÷ (€11b - €1.9b) (Based on the trailing twelve months to March 2024). So, United Internet has an ROCE of 7.9%. In absolute terms, that's a low return but it's around the Telecom industry average of 6.6%. See our latest analysis for United Internet roce Above you can see how the current ROCE for United Internet compares to its prior returns on capital, but there's only so much you can tell from the past. If you're interested, you can view the analysts predictions in our freeanalyst report for United Internet . What Does the ROCE Trend For United Internet Tell Us? When we looked at the ROCE trend at United Internet, we didn't gain much confidence. Over the last five years, returns on capital have decreased to 7.9% from 12% five years ago. However it looks like United Internet might be reinvesting for long term growth because while capital employed has increased, the company's sales haven't changed much in the last 12 months. It's worth keeping an eye on the company's earnings from here on to see if these investments do end up contributing to the bottom line. The Bottom Line On United Internet's ROCE In summary, United Internet is reinvesting funds back into the business for growth but unfortunately it looks like sales haven't increased much just yet. Since the stock has declined 22% over the last five years, investors may not be too optimistic on this trend improving either. On the whole, we aren't too inspired by the underlying trends and we think there may be better chances of finding a multi-bagger elsewhere. On a separate note, we've found 3 warning signs for United Internet you'll probably want to know about. Story continues While United Internet isn't earning the highest return, check out this freelist of companies that are earning high returns on equity with solid balance sheets. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View comments |
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| 11.05.24 06:32:57 | United Internet AG Just Missed EPS By 19%: Here's What Analysts Think Will Happen Next | |
| United Internet AG (ETR:UTDI) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. It wasn't a great result overall - while revenue fell marginally short of analyst estimates at €1.6b, statutory earnings missed forecasts by 19%, coming in at just €0.34 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year. Check out our latest analysis for United Internet earnings-and-revenue-growth After the latest results, the twelve analysts covering United Internet are now predicting revenues of €6.51b in 2024. If met, this would reflect an okay 4.1% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to soar 53% to €1.93. Before this earnings report, the analysts had been forecasting revenues of €6.49b and earnings per share (EPS) of €2.04 in 2024. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts. It might be a surprise to learn that the consensus price target was broadly unchanged at €28.59, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on United Internet, with the most bullish analyst valuing it at €43.00 and the most bearish at €23.00 per share. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business. These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the United Internet's past performance and to peers in the same industry. It's clear from the latest estimates that United Internet's rate of growth is expected to accelerate meaningfully, with the forecast 5.6% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 4.3% p.a. over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 1.5% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that United Internet is expected to grow much faster than its industry. Story continues The Bottom Line The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for United Internet. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at €28.59, with the latest estimates not enough to have an impact on their price targets. Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for United Internet going out to 2026, and you can see them free on our platform here. Even so, be aware that United Internet is showing 3 warning signs in our investment analysis, you should know about... Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View comments |
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| 20.04.24 08:49:28 | Investors in United Internet (ETR:UTDI) have unfortunately lost 37% over the last five years | |
| In order to justify the effort of selecting individual stocks, it's worth striving to beat the returns from a market index fund. But even the best stock picker will only win with some selections. So we wouldn't blame long term United Internet AG (ETR:UTDI) shareholders for doubting their decision to hold, with the stock down 42% over a half decade. The falls have accelerated recently, with the share price down 11% in the last three months. It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that. See our latest analysis for United Internet There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price. While the share price declined over five years, United Internet actually managed to increase EPS by an average of 7.4% per year. Given the share price reaction, one might suspect that EPS is not a good guide to the business performance during the period (perhaps due to a one-off loss or gain). Alternatively, growth expectations may have been unreasonable in the past. Because of the sharp contrast between the EPS growth rate and the share price growth, we're inclined to look to other metrics to understand the changing market sentiment around the stock. In contrast to the share price, revenue has actually increased by 4.2% a year in the five year period. A more detailed examination of the revenue and earnings may or may not explain why the share price languishes; there could be an opportunity. The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail). earnings-and-revenue-growth United Internet is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So we recommend checking out this freereport showing consensus forecasts What About Dividends? When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of United Internet, it has a TSR of -37% for the last 5 years. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return. Story continues A Different Perspective We're pleased to report that United Internet shareholders have received a total shareholder return of 37% over one year. That's including the dividend. That certainly beats the loss of about 6% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 3 warning signs for United Internet that you should be aware of. If you are like me, then you will not want to miss this freelist of growing companies that insiders are buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on German exchanges. Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This 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. View comments |
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