RBS  Royal Bank Scotland Group Plc

Exchange

NYSE

Sector

Finance

Industry

Commercial Banks

Market Cap.

34.72B

Current Price

$5.91
-0.35 (-5.59%)

Book Price

$13.39
Undervalued by 126.63%
Financial Institution

Company Metrics

  • P/E 0
  • P/S 2.46
  • P/B 0.55
  • EPS -1.12
  • Dividend 0 / 0%
  • Avg. Vol. 1.56M
  • Shares 5.87B
  • Market Cap. 34.72B

Company Description

The Royal Bank of Scotland Group plc, through its subsidiaries, offers banking and financial services to personal, commercial, corporate, and institutional customers in the United Kingdom, the United States, and internationally. Its UK Retail segment offers banking products and related financial services to the personal market. The company's UK Corporate segment provides banking, finance, and risk... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

I'm targeting 60% upside from Royal Bank of Scotland Group plc
Motley Fool UK - Feb 24, 2017
On Friday morning, Royal Bank of Scotland Group (LSE: RBS) reported a £7bn loss for 2016. It's the ninth consecutive annual loss and was even bigger than City forecasts of £6.1bn suggested it might be.
Royal Bank of Scotland Group PLC (NYSE:RBS) Shares Downgraded To A Sell Rating - Stock Market Daily
RBS reports wider-than-expected loss on litigation and restructuring costs - Proactive Investors UK
Why Royal Bank of Scotland Group PLC (RBS), Hewlett Packard Enterprise Co (HPE ...
Investorplace.com - Feb 24, 2017
Once again, the bears tried to take a bite out of the market, and once again the bulls didn't let them get very far. By the time the closing bell rang on Friday, the S&P 500 was up 0.15%, ending the session at 2,367.34, holding above a key technical ...
Royal Bank Of Scotland Group Plc Buys KLA-Tencor, JPMorgan Chase, Southwest ...
Nasdaq - Feb 13, 2017
Royal Bank Of Scotland Group Plc initiated holdings in KLA-Tencor Corp. The purchase prices were between $70.3 and $83.04, with an estimated average price of $76.38.
Spectrum Asset Management, Inc. Buys Barclays Bank PLC, iShares US Preferred ... - GuruFocus.com
RBS bodily harm and why Rightmove's boss won't be taking over at Leicester City
Proactive Investors UK - Feb 24, 2017
RBS boss Ross McEwan reckons the UK government should have done what the authorities in the US did, and that is recapitalise the banks more extensively in 2009.
RBS rallies on plans to scrap sale of Williams & Glyn
Proactive Investors UK - Feb 20, 2017
Shares in Royal Bank of Scotland Group plc (LON:RBS) gained today after confirming it plans to scrap its sale of 300 Williams & Glyn branches and instead set up a fund to help smaller challenger banks.
Royal Bank of Scotland: A £2.5bn shambles - Herald Scotland
Analyst Upgrades – Royal Bank of Scotland Group plc (LON:RBS) Stock Gets ... - Market Exclusive
Market Fallers: Royal Bank of Scotland Group plc, RSA Insurance Group plc ...
DirectorsTalk Interviews - Feb 24, 2017
The trading price for Royal Bank of Scotland Group plc EPIC code: LON:RBS has declined -3.97% or -9.9 points during today's session so far.
Royal Bank of Scotland Group plc (RBS) PT Raised to GBX 252 at Deutsche Bank AG - Sports Perspectives
The RBS (RBS) Stock Rating Reaffirm by the BNP Paribas - DailyQuint
Will Shares In Royal Bank Of Scotland Group plc Storm Ahead Of Barclays PLC ...
Investomania (blog) - Feb 24, 2017
Are shares in Royal Bank of Scotland Group plc (LON:RBS) (LSE:RBS.L) a better investment prospect than shares in Barclays PLC (LON:BARC) (LSE:BARC.
The Barclays PLC Upgraded Lloyds Banking Group PLC (LLOY) to Overweight - DailyQuint
How much worse could it possibly get at RBS? - Tip TV
Proactive Investors UK - Feb 24, 2017
Mike Ingram, market analyst at BGC Partners talks to Proactive about Royal Bank of Scotland Group plc's (LON:RBS) latest results.
RBS to slash costs as it struggles to return to profit
Proactive Investors UK - Feb 13, 2017
The bank reduced its workforce by about 10,000 in 2016 after having lost more than £50bn since the financial crisis and its bail out in 2008.
Royal Bank of Scotland said to Plan More Than $1 Billion of Cost Cuts as Jobs ... - Financial Express
PRESS: Royal Bank Of Scotland Prepares To Cut More Costs And Jobs - London South East (registration) (blog)
The Royal Bank of Scotland Group plc: Results centre: Annual Results 2016
The Wall Street Transcript - Feb 24, 2017
Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry's standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for RBS to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate RBS's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

Poor Cash Return on Invested Capital over the past 5 years

RBS has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

RBS has only created $- of cash for every $100 invested.
Figures in GBP. Fiscal year ends in December
20112012201320142015
Free Cash Flow - - - - -
divided by
Invested Capital 1.51T 1.31T 1.03T 1.05T 815.41B
Cash ROIC - - - - -

Very Poor Return on Equity over the past 5 years

RBS has shown an inability to deliver results for shareholders. This could be due to poor management, RBS operating in a highly competitive industry, or having a weak business in general.

RBS has generated a $6.69 loss for every $100 of Shareholders' Equity.
Figures in GBP. Fiscal year ends in December
20112012201320142015
Net Income -2.00B -5.68B -8.60B -2.77B -1.59B
divided by
Stockholders' Equity 74.82B 68.13B 58.74B 57.25B 53.43B
Return on Equity -2.67% -8.34% -14.64% -4.84% -2.98%

Poor Business Performance over the past 10 years

RBS's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

RBS has been losing money for the majority of the past 10 years.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow - - - - - - - - - -

Low or No Reinvestment of Profits over the past 10 years

RBS has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to RBS operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 15.49B 21.07B 7.54B 12.13B - 18.93B 10.60B - -2.52B -4.02B
Retained Earnings Growth - 36.06% -64.21% 60.89% -100.00% - -44.02% -100.00% - -59.65%

Highly Competitive Industry over the past 10 years

It's likely that RBS is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely RBS invests heavily in R&D and Sales, General & Administrative expenses.

Only $- of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 6.20B 7.30B -24.14B -3.61B -1.13B -2.00B -5.68B -8.60B -2.77B -1.59B
divided by
Revenue - - - - - - - - - -
Net Profit Margin - - - - - - - - - -

Weak Pricing Power over the past 10 years

RBS is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that RBS has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit - - - - - - - - - -
divided by
Revenue - - - - - - - - - -
Gross Margin - - - - - - - - - -

Low Capital Intensity over the past 10 years

RBS has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that RBS may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

-% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure - - - - - - - - - -
divided by
Net Income 6.20B 7.30B -24.14B -3.61B -1.13B -2.00B -5.68B -8.60B -2.77B -1.59B
Capital Expenditure Ratio - - - - - - - - - -

Very Strong Dividend History over the past 10 years

RBS has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests RBS is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid 2.73B 3.41B 3.19B 1.25B 4.24B 40.00M 301.00M 403.00M 383.00M 416.00M
divided by
Shares Outstanding 498.61M 498.30M 828.15M 2.67B 5.36B 5.41B 5.50B 5.60B 5.72B 5.79B
Dividend Paid Per Share 8.68 10.86 6.12 0.74 1.25 0.01 0.09 0.11 0.11 0.11
Price at Year End - - - - 14.79 11.20 10.41 11.26 12.06 8.94
Dividend Yield - - - - 8.49% 0.10% 0.83% 1.01% 0.88% 1.28%

History of Stock Buybacks over the past 10 years

RBS has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in GBP. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 498.61M 498.30M 828.15M 2.67B 5.36B 5.41B 5.50B 5.60B 5.72B 5.79B
Stock Bought Back - 0.06% -39.83% -68.94% -50.27% -0.90% -1.64% -1.73% -2.19% -1.11%
Share your thoughts about RBS

Sign Up or Log In to start contributing!


Discussion

Nothing here yet. Be the first to post!