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Latitude Group Holdings Limited
Financial Services · Credit Services
Updated just now
$0.91
MARKET CAP
$940.96M
P/E RATIO
50.3
DIV. YIELD
9.7%
FRANKING
57%
Latitude Group Holdings Limited engages in sales finance and consumer lending businesses in Australia and New Zealand. The company operates through Australia and New Zealand Pay (A&NZ Pay) and Australia and New Zealand Money (A&NZ Money).
View full descriptionThe Warsi Rating combines two proven approaches: value investing principles and dividend strategy. A stock must score 70+ on both to be rated Solid or higher.
10-year ROE trends, dividend history, price ceiling calculations, and every red flag explained.
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1.6% average is below the 12% threshold. This suggests the business may lack a durable competitive advantage.
Current Snapshot
10Y Avg
1.6%
Threshold
12.0%
Worst Year
-12.6%
Why It Matters
ROE shows how effectively management turns shareholder capital into profit. High and stable ROE can signal pricing power, cost discipline, or both.
Formula
Net Income / Shareholders' Equity x 100Method
Use the 10-year average ROE and review the weakest year to check whether returns stayed resilient across cycles.
Worked Example
This company's 10-year average ROE is 1.6%, meaning each $1 of shareholder equity generates $0.02 in annual profit. The threshold is 12%, and the worst single year was -12.6%.
How to Interpret
Higher and steadier ROE generally supports stronger long-term compounding. Large drawdowns in weak years can point to fragility.
Lower ROE means your investment compounds more slowly. At 1.6%, this business needs more capital to generate the same returns as competitors. Consider whether other strengths (yield, stability) compensate for weaker profitability.
Sources
Real cash left after running the business
Negative free cash flow means the company is consuming cash. May need to raise debt or equity to fund operations.
Current Snapshot
Current FCF
$-325M
Pass Rule
> $0
Status
Negative
Why It Matters
Free cash flow is the cash available after core operating and capital needs. It is central to dividend capacity.
Formula
Operating Cash Flow - Capital ExpendituresMethod
Review whether free cash flow is consistently positive and whether it is sufficient relative to dividends and debt needs.
Worked Example
This company generated $-325M in free cash flow — cash left after operating costs and capital expenditure. Negative FCF means the company is consuming more cash than it generates.
How to Interpret
Persistently negative free cash flow can force reliance on borrowing or equity issuance to maintain payouts.
Negative cash flow means dividends may require borrowing - an unsustainable situation. The company is spending more cash than it generates, which can't continue indefinitely.
Sources
Price versus estimated intrinsic value and required return thresholds.
How current price compares with estimated intrinsic value
Stock is trading 44% BELOW the fair-value threshold (includes 30% margin of safety).
Current Snapshot
Current Margin
60.6%
Industry Threshold
30%
Status
44% Undervalued
Why It Matters
Margin of safety provides a valuation buffer against modelling uncertainty and adverse business outcomes.
Formula
(Estimated Intrinsic Value per Share - Current Price) / Estimated Intrinsic Value per Share x 100Method
Estimate intrinsic value using a two-stage DCF (10-year projection plus terminal value), then compare with current price.
Worked Example
For this stock now: intrinsic value is $2.31 per share, current price is $0.91, and margin of safety is 60.6%.
How to Interpret
Positive margin indicates price below modelled value; negative margin indicates price above modelled value. Compare against the industry's required buffer.
Price is below your required threshold, so you retain a margin-of-safety buffer against normal valuation error and market volatility.
Sources
What percentage of the stock price comes back as earnings each year
Consistency of profits over time
1 loss year(s) found with only 4 years of data. Limited data requires 100% positive EPS - industry exemptions don't apply.
Current Snapshot
Positive Years
3/4
Allowed Losses
0 (limited)
EPS CAGR
-66.9%
Why It Matters
Consistency in EPS helps distinguish resilient earnings power from one-off performance spikes.
Formula
Positive EPS Years / Available EPS YearsMethod
For 8+ years of data, apply industry-specific loss tolerance. For limited data, every available year must be positive.
Worked Example
This company reported positive earnings in 3 of the last 4 years, with 1 loss year. With only 4 years of data, every year must be positive. EPS growth rate (CAGR) is -66.9%.
How to Interpret
Fewer loss years and stronger EPS continuity generally improve confidence in future dividend and valuation assumptions.
Loss years signal unpredictable earnings. During loss periods, companies often cut dividends to preserve cash. Your income could be at risk in the next downturn.
Sources
Is the business growing or shrinking over time?
Revenue has grown steadily at 11% over 4 years — consistent growth in a financial institution is a positive sign for dividend sustainability.
Current Snapshot
Revenue Change
+10.5%
Debt Change
N/A (financials)
Trend State
Improving
Why It Matters
Revenue trend shows whether the business is expanding or contracting. Debt trend adds context on whether growth is being funded conservatively.
Formula
Revenue Change (%) = (Latest Revenue - Earliest Revenue) / |Earliest Revenue| x 100; Debt Change (%) = (Latest Debt - Earliest Debt) / |Earliest Debt| x 100Method
Map annual revenue history and, where relevant, annual debt history. For financial companies, debt is excluded because deposits and reserves distort this signal.
Worked Example
Revenue changed by +10.5% across the displayed period.
How to Interpret
Rising revenue with stable or falling debt is typically stronger than rising revenue funded by rapidly rising leverage.
Revenue has grown steadily at 11% over 4 years — consistent growth in a financial institution is a positive sign for dividend sustainability.
Sources
Insufficient dividend history. Barsi methodology requires 6 years of data to calculate average yield.
Current Snapshot
6Y Avg Yield
N/A
6% Requirement
6.0%
Gross Yield
N/A
Why It Matters
Yield translates dividend income into a percentage of the price paid, which is central to income-first screening.
Formula
Annual Dividends per Share / Stock Price x 100Method
Use the 6-year average annual dividend for consistency and compare the result with the 6% framework requirement.
Worked Example
If annual dividends are $0.60 and the share price is $10, dividend yield is 6.0%.
How to Interpret
Higher sustainable yield improves upfront income, but unusually high yields may reflect elevated risk or weak coverage.
Without 6 years of dividend history, we can't assess whether the yield is sustainable or a one-time spike. More data is needed to evaluate income potential.
Sources
Track record of consistent dividend payments
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| 20 Mar 2026Interim | 21 Apr 2026 | $0.07 | 100% | $0.05 | $0.02 |
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| 19 Sept 2025Final | 17 Oct 2025 | $0.04 | 0% | $0.04 | $0.00 |
| 21 Mar 2025Interim | 18 Apr 2025 | $0.03 | 0% | $0.03 | $0.00 |
| 21 Mar 2023Interim | 18 Apr 2023 | $0.04 | 0% | $0.04 | $0.00 |
| 23 Sept 2022Final | 21 Oct 2022 | $0.08 | 0% | $0.08 | $0.00 |
| 28 Feb 2022Interim | 28 Mar 2022 | $0.08 | 0% | $0.08 | $0.00 |
| 30 Aug 2021Final | 27 Sept 2021 | $0.08 | 0% | $0.08 | $0.00 |
Only 5 years of dividend history available. Barsi methodology requires 6+ years to evaluate consistency.
Current Snapshot
History
5yr
Predictability
N/A
Payout Health
N/A
Why It Matters
Payment consistency is a direct test of dividend reliability. Large cuts or skips often appear before confidence recovers.
Formula
Consecutive Years = count of years with dividend payments and no disqualifying skip/cut eventsMethod
Require at least 6 years of history, then check for skipped years and large cuts, allowing approved systemic-event exceptions.
Worked Example
This company has 5 years of dividend history (2021–2026). No suspensions detected — 5 consecutive years of payments. Predictability: N/A. Payout health: N/A. The minimum requirement is 6 years.
How to Interpret
Longer uninterrupted records generally signal stronger income reliability than high yield alone.
Without 6 years of history, we can't verify this company maintained dividends through economic cycles. Longer track records provide confidence your income will continue.
Sources
Industry category of the business
Financial Services is not a BESST sector. Non-BESST stocks receive a lower base score but can still qualify with exceptional dividend metrics.
Current Snapshot
Industry
Credit Services
BESST Match
No
Score Impact
No bonus
Why It Matters
Sector classification helps contextualise risk and demand durability, which can materially affect dividend stability.
Formula
BESST Match = Sector in {Banks, Energy, Sanitation, Insurance, Telecom}Method
Match company sector or industry against BESST categories. A match adds scoring support but does not replace core dividend checks.
Worked Example
This company operates in Credit Services (Financial Services sector). It does not match a BESST sector, so it receives the standard base score. Non-BESST stocks can still qualify with strong dividend metrics.
How to Interpret
BESST alignment is a positive context signal. Non-BESST stocks can still qualify with strong yield and dividend consistency.
Non-essential businesses face demand drops during recessions — discretionary spending is first to be cut. This increases cyclical risk for dividends, but companies with decades of consistent payments can still demonstrate durability.
Sources
How much of a company's earnings are paid out as dividends
A 87% payout means the company distributes most of its earnings as dividends — more income per share now, but less room for growth. Around 67% is often considered “normal” for established companies. This level feeds directly into the price ceiling calculation.
Current Snapshot
Latest Ratio
86.8%
Healthy Range
30%-75%
Zone
Elevated
Why It Matters
Payout ratio links dividends to earnings capacity and helps evaluate whether current distributions are likely to remain supportable.
Formula
Payout Ratio (%) = (Annual Dividend per Share / Earnings per Share) x 100Method
Calculate year-by-year payout ratios where EPS is positive, classify each year by sustainability zone, and compare with the current TTM ratio.
Worked Example
$0.16 dividend / $0.03 EPS equals 475.8% payout ratio.
How to Interpret
Ratios in the middle range are usually more sustainable than very high ratios. Values above 100% indicate dividends exceeded earnings in that period.
A 87% payout means the company distributes most of its earnings as dividends — more income per share now, but less room for growth. Around 67% is often considered “normal” for established companies. This level feeds directly into the price ceiling calculation.
Sources
2.0% earnings yield is below the 7.5% threshold. You'd earn nearly as much from safer government bonds, which means the extra risk of owning shares isn't being compensated.
Current Snapshot
Current Yield
2.0%
Required Yield
7.5%
Spread
-5.5pp
Why It Matters
Earnings yield reframes valuation as return on price paid. It helps compare equity earnings power against lower-risk alternatives.
Formula
(Earnings per Share / Stock Price) x 100Method
Calculate current earnings yield, then compare it to the required yield for the stock's industry setting.
Worked Example
With EPS of $0.02 and a share price of $0.91, earnings yield is 2.0%. The required yield for this industry is 7.5% (based on 4.5% government bond rate plus a risk premium).
How to Interpret
A yield above the required level suggests better valuation support; below it indicates thinner compensation for equity risk.
Returns don't justify the added risk compared to safe bonds. Consider whether the dividend yield alone compensates, or wait for a better price.
Sources