Stagecoach is a massive operator in the UK for transportation.

Stagecoach is a massive operator in the UK for transportation. The company currently has a 26% market share on the bus travel sector, followed closely by FirstGroup (21%). Stagecoach has been around since 1980 and went pubic 13 years later in 1993. In the past 5 years, however, the company looks to be taking a turn for the worst – COVID19 will hurt the company badly.

The financials for stagecoach are very mixed. Current market capitation is £348.2m with 2019 revenue at £2.33bn - a 2% increase from 2018. Cash on hand for the company is £170m, a drop of around 28% from 2018 (£238m). In the same year profit after tax for 2019 was £21.6m down a massive 70% from 2018 (£70.5m). Total assets have also fallen to £1.29bn from £1.89bn, liabilities have also shrunk too – this tells me the balance is shrinking which could indicate limited growth for the future.

Stagecoach is an essential company to many cities (like the one I live) people rely on buses to get to work and school in the morning therefore stagecoach is well placed in the market. That being said because of coronavirus, revenues will be massively hit, and they have still had to resumes services for key workers (unlike airlines). I think the company will make a massive loss this year however the full industry will. Stagecoach would be eligible for government bailouts if it ever came it. Even though the shares are down 59% this year & 84% from all-time highs the scope for return could be there in the mid-term future. Unlike many companies buses are essential infrastructure to cities and no other competitor could take the companies place – the scope for return on companies like stagecoach could be much bigger than blue-chip companies like Apple, having said that, stagecoach could definitely fall further.