Watkin Jones (WJG) AI Stock Analysis

• Market Cap: £73.27M
• Dividend Yield: N/A
• Average Volume (3M): 703.71K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.92
• Revenue Growth: -27.17%
• EPS Growth: 98.73%
• Country: UK
• Employees: 600
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Residential Construction
• EPS (TTM): 0.00
• Shares Outstanding: 256,653,100
• 10 Day Avg. Volume: 513,156
• 30 Day Avg. Volume: 703,712
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: £38.00
• Price Target Upside: 33.10% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 46 Neutral
• Price Target: 29.00p ▲(1.58% Upside)

The overall stock score is primarily influenced by the company's mixed financial performance, characterized by declining revenue and margins but improved cash flow. Technical analysis indicates a bearish trend with weak momentum, while valuation metrics are unattractive due to a negative P/E ratio and lack of dividend yield. These factors collectively suggest caution for potential investors.

Watkin Jones Business Overview & Revenue Model

Company Description

Watkin Jones Plc engages in the development and the management of properties for residential occupation in the United Kingdom. The company operates through Student Accommodation, Build to Rent, Affordable Homes, and Accommodation Management segments. It is involved in the development of purpose-built student accommodation, build to rent accommodation, and residential housing property; and management of student accommodation and build to rent property. The company was formerly known as Watkin Jones Limited and changed its name to Watkin Jones Plc in March 2016. Watkin Jones Plc was founded in 1791 and is based in London, the United Kingdom.

How the Company Makes Money

Watkin Jones generates revenue primarily through the development and sale of residential properties, especially student accommodations. The company earns money by constructing new properties and leasing them out to students and young professionals, which provides a steady stream of rental income. Additionally, WJG also engages in partnerships with universities and local authorities to develop tailored accommodation solutions, enhancing its market position and securing long-term contracts. The company's revenue model is bolstered by its expertise in project management and its ability to deliver developments on time and within budget, leading to higher profitability. Moreover, Watkin Jones has diversified its portfolio to include build-to-rent schemes, which further contributes to its revenue through ongoing rental income. Strategic partnerships with investors and financial institutions also play a significant role in financing projects, thus facilitating growth and expansion in the property market.

Watkin Jones Financial Statement Overview

Summary

Watkin Jones shows mixed financial performance with declining revenue and margins, but maintains a relatively stable capital structure and improved cash flow generation. However, the company faces challenges in profitability and efficiency that need addressing to enhance future financial health.

Income Statement

The gross profit margin for the latest year is 9.33%, reflecting a decrease compared to previous periods. The net profit margin is 0.52%, indicating tight profitability. Revenue has declined by 12.31% compared to the previous year, showing a negative growth trend. EBIT and EBITDA margins are 0.98% and 2.99% respectively, both highlighting low operational efficiency. The company faces challenges in maintaining revenue and profitability levels.

Balance Sheet

The debt-to-equity ratio is 0.41, suggesting a moderate level of leverage. Return on equity (ROE) is low at 1.43%, indicating limited returns for shareholders. The equity ratio stands at 39.95%, pointing to a stable capital structure. The balance sheet demonstrates moderate leverage but challenges in generating shareholder returns.

Cash Flow

Free cash flow has improved significantly with a positive change from a previous negative position. The operating cash flow to net income ratio is 15.95, suggesting strong cash generation relative to net income. The company exhibits strong cash flow generation, though historical variability poses a risk.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	316.45M	362.37M	413.24M	407.08M	430.21M	354.12M
Gross Profit	29.24M	33.81M	34.86M	67.07M	84.78M	75.92M
EBITDA	5.94M	10.83M	-32.27M	32.80M	66.03M	40.90M
Net Income	-382.00K	1.90M	-32.55M	13.41M	41.93M	21.09M
Balance Sheet
Total Assets	322.86M	331.89M	371.52M	386.96M	430.62M	459.95M
Cash, Cash Equivalents and Short-Term Investments	86.83M	96.91M	72.56M	110.84M	136.29M	134.51M
Total Debt	50.87M	54.36M	73.72M	77.39M	141.21M	174.12M
Total Liabilities	190.29M	199.30M	241.51M	210.01M	245.81M	292.11M
Stockholders Equity	132.57M	132.59M	130.00M	176.95M	184.81M	167.84M
Cash Flow
Free Cash Flow	21.95M	30.10M	-32.05M	-27.52M	61.25M	37.97M
Operating Cash Flow	22.17M	30.22M	-31.50M	-26.86M	61.46M	38.29M
Investing Cash Flow	16.55M	16.74M	14.98M	11.58M	-147.00K	564.00K
Financing Cash Flow	-18.98M	-22.43M	-21.89M	-10.17M	-59.53M	-19.99M

Watkin Jones Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 28.55
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:WJG, the sentiment is Negative. The current price of 28.55 is below the 20-day moving average (MA) of 30.99, below the 50-day MA of 30.57, and below the 200-day MA of 30.22, indicating a bearish trend. The MACD of -0.47 indicates Positive momentum. The RSI at 37.20 is Neutral, neither overbought nor oversold. The STOCH value of 14.23 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GB:WJG.

Watkin Jones Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SPR	―	£122.02M	8.64	8.56%	0.66%	5.26%	86.19%
GLE	―	£215.41M	13.61	5.23%	2.70%	5.93%	-18.26%
Sector *	―	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
BWY	―	£3.10B	19.77	4.49%	2.25%	16.91%	20.93%
VTY	―	£2.07B	-211.91	-0.31%	―	-0.57%	-104.08%
CRST	―	£424.26M	-5.78	-9.56%	1.50%	-3.50%	-176.18%
WJG	―	£73.27M	-190.33	-0.29%	―	-27.17%	98.73%

Watkin Jones Corporate Events

Watkin Jones Reports Strong FY25 Performance Amid Market Challenges

Watkin Jones plc reported a strong second half performance for FY25, with expected revenue of approximately £280 million and adjusted operating profit aligning with market expectations. The company emphasized effective cash management and operational delivery, completing several key projects and maintaining a robust pipeline for future developments. Despite challenging market conditions, Watkin Jones remains optimistic about its prospects in FY26, driven by a structural shortage in rental and student housing and sustained investor interest.

The most recent analyst rating on (GB:WJG) stock is a Hold with a £31.00 price target. To see the full list of analyst forecasts on Watkin Jones stock, see the GB:WJG Stock Forecast page.

Watkin Jones Enters £182m PBSA Joint Venture with Maslow Capital

Watkin Jones has announced a joint venture with Maslow Capital to develop a new 784-bed purpose-built student accommodation scheme in Glasgow, valued at approximately £182 million. This transaction is expected to generate significant revenue for Watkin Jones, contributing to its financial performance in FY2025 and showcasing its ability to expand its portfolio of funding partners amidst the UK’s volatile residential development sector.

The most recent analyst rating on (GB:WJG) stock is a Hold with a £31.00 price target. To see the full list of analyst forecasts on Watkin Jones stock, see the GB:WJG Stock Forecast page.

Watkin Jones to Develop 200 Student Units in Bristol

Watkin Jones has signed a development partnership to deliver approximately 200 purpose-built student accommodation units in Bristol, transforming a disused railway embankment into a vibrant community. This project, expected to generate over £28 million in revenue, aligns with the company’s diversification strategy and highlights its ability to attract institutional investment despite challenging market conditions.

The most recent analyst rating on (GB:WJG) stock is a Hold with a £0.35 price target. To see the full list of analyst forecasts on Watkin Jones stock, see the GB:WJG Stock Forecast page.