DCC (DCCPY) AI Stock Analysis

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DCC

(OTC:DCCPY)

Rating:72Outperform

Price Target:―

DCCPY's stock shows a solid financial foundation with strong cash flow generation and a healthy balance sheet. The recent strategic focus on the Energy division and plans for divestments provide a positive outlook. However, technical indicators suggest caution due to potential downward trends. Valuation is moderate, with room for growth if the company's strategic plans materialize successfully.

DCC (DCCPY) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$6.33B

Dividend Yield7.72%

Average Volume (3M)39.00

Price to Earnings (P/E)24.5

Beta (1Y)0.67

Revenue Growth-3.44%

EPS Growth4.09%

CountryUS

Employees16,700

SectorEnergy

Sector Strength51

IndustryOil & Gas Refining & Marketing

Share Statistics

EPS (TTM)0.71

Shares Outstanding196,909,930

10 Day Avg. Volume98

30 Day Avg. Volume39

Financial Highlights & Ratios

PEG Ratio1.63

Price to Book (P/B)1.21

Price to Sales (P/S)0.00

P/FCF Ratio8.44

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

DCC Business Overview & Revenue Model

Company DescriptionDCC plc (DCCPY) is a leading international sales, marketing, and support services group operating across four main sectors: LPG, Retail & Oil, Healthcare, and Technology. The company provides a diverse range of products and services ranging from liquefied petroleum gas distribution to healthcare solutions and technology products & services, catering to both businesses and consumers worldwide.

How the Company Makes MoneyDCC plc generates revenue through its diversified operations across its four main sectors. In the LPG sector, the company earns money by distributing liquefied petroleum gas to a wide array of industrial, commercial, and domestic customers. In the Retail & Oil sector, DCC operates as a distributor of fuels and lubricants, serving retail and commercial customers. The Healthcare sector contributes to revenue through the provision of products and services to healthcare providers, including medical devices and pharmaceuticals. Lastly, the Technology sector adds to the company's income by delivering supply chain management services and distributing technology products and services. DCC's earnings are bolstered by strategic acquisitions, efficient supply chain operations, and long-term partnerships with key suppliers and customers.

DCC Earnings Call Summary

Earnings Call Date:May 13, 2025

(Q2-2025)

% Change Since: -0.67%|

Next Earnings Date:Nov 18, 2025

Earnings Call Sentiment Positive

The earnings call presented a positive outlook with a strategic focus on the high-performing Energy division and plans to simplify operations through divestments. Despite facing some market challenges and currency headwinds, the company's growth strategy and cash generation capabilities are strong, supporting shareholder returns.

Q2-2025 Updates

Positive Updates

Strategic Focus on Energy

DCC announced a strategic plan to focus solely on its Energy business, which is the largest division with the highest returns, aiming to double profits by 2030.

Profit Growth and Dividend Increase

Operating profit increased by 4.7% to GBP 259.3 million, and the interim dividend was raised by 5% to 66.19p per share.

Strong Energy Division Performance

DCC Energy profits grew 8.4% on a constant currency basis, with solid growth driven by acquisitions and organic performance in various segments.

Cash Generation and Shareholder Returns

The Energy business continues to be highly cash-generative with a free cash flow conversion of 101%, and plans are in place to return surplus cash to shareholders.

Significant Strategic Progress

The company made GBP 130 million in acquisition investments, mainly in DCC Energy, and divested a majority stake in liquid gas operations in Hong Kong and Macau.

Negative Updates

Currency Headwinds

The company faced a 1.3% headwind from FX translation, with expectations of over 2% for the full year due to the strengthening of sterling.

Challenges in Technology Division

DCC Technology's market conditions remain weak, particularly in consumer IT products in Continental Europe, impacting profits.

Healthcare Market Challenges

The primary care market in the UK remains weak due to NHS funding constraints, affecting the Patient Health segment.

Solar Market Pressures

The solar distribution market faced challenges with falling panel prices impacting margins.

Company Guidance

During the DCC Q2 2025 earnings call, significant guidance was provided regarding the company's strategic direction, financial performance, and future outlook. DCC announced a strategic shift to focus solely on its Energy business, citing it as the most compelling growth opportunity with strong returns, aiming to double profits by 2030 and reducing carbon intensity by 26% since FY '22. The company plans to sell its Healthcare division, which has shown an operating profit growth of 12% CAGR over the last decade, by 2025, and to review strategic options for its Technology division over the next 24 months. Financially, DCC reported a 4.7% increase in operating profit to GBP 259.3 million for H1 FY '25, with the Energy division contributing 74% of overall group profits. The company also highlighted a commitment to maintaining a strong balance sheet, with a free cash flow conversion of 101% over the last decade, and plans to return any surplus cash from the simplification of the group to shareholders while continuing disciplined capital allocation and growth through M&A activities.

DCC Financial Statement Overview

Summary

DCC has a stable financial foundation with strengths in cash flow generation and a solid balance sheet. Revenue growth faces challenges, with consistent profitability margins and well-managed leverage. Continued focus on improving revenue and profit margins could enhance overall financial performance.

Income Statement

Positive

The company has shown a mixed performance in terms of revenue growth, with a decrease in total revenue from the previous year. Gross profit margin is stable at 12.5%, and net profit margin is 1.6%, indicating moderate profitability. EBIT and EBITDA margins are relatively stable but could improve to enhance overall profitability.

Balance Sheet

Positive

The balance sheet reflects a healthy equity ratio of 32.6%, indicating a strong capital structure. The debt-to-equity ratio stands at 0.75, suggesting manageable leverage. Return on Equity (ROE) is at 10.6%, showing decent returns for shareholders, though there's room for improvement.

Cash Flow

Positive

Free cash flow has grown by 15% over the past year, demonstrating strong cash generation capabilities. The operating cash flow to net income ratio is 2.21, indicating effective conversion of profits into cash. The free cash flow to net income ratio of 1.51 further supports the company's strong cash position.

Breakdown	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Income Statement
Total Revenue	19.86B	22.20B	17.73B	13.41B	14.76B
Gross Profit	2.48B	2.40B	2.04B	1.82B	1.74B
EBITDA	882.88M	856.65M	770.47M	707.32M	640.99M
Net Income	326.25M	334.02M	312.37M	292.62M	245.51M
Balance Sheet
Total Assets	9.48B	9.84B	9.56B	8.03B	7.92B
Cash, Cash Equivalents and Short-Term Investments	1.11B	1.42B	1.39B	1.79B	1.79B
Total Debt	2.31B	2.60B	2.34B	2.09B	2.39B
Total Liabilities	6.30B	6.78B	6.59B	5.33B	5.38B
Stockholders Equity	3.09B	2.98B	2.91B	2.65B	2.49B
Cash Flow
Free Cash Flow	491.67M	427.46M	257.42M	564.89M	348.09M
Operating Cash Flow	722.02M	656.90M	451.77M	727.77M	529.11M
Investing Cash Flow	-525.29M	-531.52M	-867.43M	-391.52M	-319.50M
Financing Cash Flow	-472.75M	-100.16M	21.49M	-256.63M	-15.46M

DCC Technical Analysis

Technical Analysis Sentiment

Positive

Last Price32.56

Price Trends

50DMA

31.57

Positive

100DMA

32.09

Positive

200DMA

32.47

Positive

Market Momentum

MACD

0.08

Negative

RSI

62.30

Neutral

STOCH

77.73

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DCCPY, the sentiment is Positive. The current price of 32.56 is above the 20-day moving average (MA) of 31.50, above the 50-day MA of 31.57, and above the 200-day MA of 32.47, indicating a bullish trend. The MACD of 0.08 indicates Negative momentum. The RSI at 62.30 is Neutral, neither overbought nor oversold. The STOCH value of 77.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DCCPY.

DCC Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VVV	73 Outperform	$4.86B	18.53	174.55%	―	9.56%	64.10%
DCCPY	72 Outperform	$6.33B	24.45	6.74%	7.72%	-3.44%	4.09%
SUN	72 Outperform	$8.30B	9.77	26.11%	6.61%	-3.59%	22.77%
DINO	71 Outperform	$7.75B	35.13	-1.49%	4.86%	-11.17%	-109.60%
UGP	71 Outperform	$3.36B	8.43	14.87%	5.03%	-4.58%	-23.80%
Sector *	68 Neutral	$14.81B	9.70	6.36%	5.32%	4.12%	-71.24%
CSAN	57 Neutral	$2.30B	5.14	-69.81%	6.40%	-2.76%	-628.74%

* Energy Sector Average

Performance Comparison

DCCPY

DCC

32.56

-1.70

-4.96%

DINO

HF Sinclair Corporation

41.16

-9.51

-18.77%

UGP

Ultrapar Participacoes SA

3.10

-0.63

-16.89%

SUN

Sunoco

54.31

1.49

2.82%

VVV

Valvoline

38.20

-3.88

-9.22%

CSAN

Cosan

4.91

-4.71

-48.96%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Apr 30, 2025