Marshall Motor Holdings (MMH) continued to perform robustly, although the FY19 PBT was slightly below our estimate as the losses of recently acquired businesses at the year end were slightly higher than we expected. We nevertheless have slightly increased our FY20 PBT estimates to reflect the higher than expected FY19 sales, partly offset by a slightly weaker margin due to both the acquisitions and still challenged markets. An FY21 P/E ratio of 6.5x remains undemanding. It is further supported by the FY19 dividend, which has been maintained and yields 6.0%.
Disciplined outperformance of markets once again
MMH continued to invest in new dealerships during 2019 despite what proved to be another year of challenges in its markets. New and used car demand in the UK remained subdued, while in volume terms MMH outperformed the market in new retail, new fleet and used car unit sales.
Marshall Motor Holdings Plc (LON:MMH), together with its subsidiaries, engages in retailing passenger cars and commercial vehicles in the United Kingdom. It sells new and used vehicles; and provides after sales services, such as servicing, body shop repairs, and parts sales.