One-glance verdict
Undervalued
$41.44 our estimate vs market $30.18
27% below our estimate, below the bear case
Fundamentals snapshot
Computershare Limited
CMSQY · OQX · Financial Services · Capital Markets
Current price
$30.18
52-week range
$18.82 - $31.25
Market cap
$17.46B
Balance sheet
Healthy
11.14x Adequate
Net debt $302.10M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
1 Risk
3 rewards · 1 risks
- Reward Revenue grew 4.6% last year.
- Reward Free cash flow was positive in 4/10 years.
- Reward Dividend yield is 3.1% with 19-year payout history.
- Risk Stock trades 11.5% above its 5-year average P/E.
What this company does
Computershare Limited
Computershare handles the essential but complex record-keeping for large public companies, such as managing their official list of stockholders and administering employee stock plans. The company primarily earns predictable income from long-term service fees, creating stable recurring revenue (income that's highly likely to continue in the future), and also makes significant money from interest on client funds it holds temporarily. This business model means its profits can rise and fall with changes in global interest rates.
How the company got here
Computershare started in Melbourne, Australia, in 1978, originally creating software to help companies manage their list of shareholders. It grew by handling this process for more and more businesses who found it too expensive to do themselves. The company expanded internationally, opening offices and acquiring the shareholder services departments of major banks and competitors in the United Kingdom, North America, and other regions. This strategy of buying other companies has been a key part of its growth into a global leader in its field.
What it actually does
Think of Computershare as a professional record-keeper for large companies. When you own a share of a company, Computershare is often the business in the background that keeps track of who owns what, making sure your ownership is officially recorded. They handle essential but often invisible tasks like sending out dividend payments (a share of the company's profits paid to shareholders), managing employee stock plans, and running company shareholder meetings. For companies, Computershare manages the complex process of tracking millions of investors and transactions.
Issuer Services
This is Computershare's largest and original business, making up the biggest piece of its revenue. It acts as a transfer agent (a company that keeps records of who owns a company's stocks and bonds) for publicly traded companies. Essentially, companies pay Computershare to maintain their official list of shareholders, manage corporate actions (major events like a merger or stock split), and handle communications with investors. This service is the foundation of the company, ensuring that the ownership records of major corporations are accurate and secure.
Employee Share Plans
Many large companies offer their staff the chance to buy company stock, often at a discount, as a way to attract and retain talent. Computershare manages these employee stock plans on behalf of those companies. They handle the administration, from tracking who is eligible to executing the buying and selling of shares for employees. This segment earns money from fees paid by the client companies and from transaction fees when employees trade their shares.
Computershare Corporate Trust
This part of the business acts as a neutral third party for complex financial transactions, often involving debt. For example, when a company issues bonds (a way of borrowing money from investors), Computershare can act as the trustee, ensuring the company follows all the rules and that the investors get their payments. They provide services for governments and financial institutions for things like mortgage-backed securities (investments made up of a bundle of home loans) and other structured financial products. This division has grown significantly, partly through the acquisition of similar businesses from large banks.
What management is betting on now
The company's strategy focuses on simplifying its operations and growing its three main businesses: Issuer Services, Employee Share Plans, and Corporate Trust. A key priority is successfully integrating the large corporate trust businesses it recently acquired, aiming to make them more efficient. Management is also focused on growing revenue from recurring client fees and transactions, which makes its earnings more predictable. Additionally, Computershare is investing in technology, including using Artificial Intelligence (AI) to improve efficiency and create new services for clients.
Price history
How the share price has moved
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Is it cheap or expensive?
Fair value $41.44 vs current price $30.18
Our most-likely fair value is $41.44 a share — about 37.3% above today's price of $30.18, so the stock currently looks cheap (undervalued).
Is it drowning in debt?
Healthy
Net debt $302.1M. Interest coverage 11.1x.
Net debt
$302.10M
Interest coverage
11.14x
Computershare Limited is healthier than 0 of 1 peers on balance-sheet leverage.
Healthy
Worse cushion
Baseline
Better cushion
CMSQY
BASELINE
Computershare Limited
Total debt $1.36B Interest coverage 11.14x This is the baseline the peer rows are being compared against.
What you should know
The case for and against CMSQY
3 Rewards
1 Risk
Rewards
-
Revenue grew 4.6% last year.
-
Free cash flow was positive in 4/10 years.
-
Dividend yield is 3.1% with 19-year payout history.
Risks
-
Stock trades 11.5% above its 5-year average P/E.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
28.21x
Forward P/E
—
P/B
7.64x
P/S
5.34x
EV/EBITDA
16.50x
PEG ratio
1.43x
Profitability
How much profit each dollar creates
Gross margin
28.5%
Operating margin
30.1%
Net margin
18.9%
ROE
28.0%
ROA
11.3%
Health
Liquidity and balance-sheet strength
Debt / equity
0.59x
Current ratio
2.52x
Quick ratio
2.24x
Total debt
$1.36B
Total cash
$1.05B
Growth
How the business has been compounding
Revenue TTM
$3.27B
Revenue 5Y CAGR
5.5%
EPS TTM
1.07
EPS 5Y CAGR
13.2%
Cash flow
How much cash the business throws off
Operating CF TTM
$836.60M
Free CF TTM
$801.20M
FCF margin
24.5%
Dividend
Shareholder payout
Yield
3.1%
Payout ratio
0.0%
Last ex-div date
2026-08-19