Smart group - SIQ

 SIQ

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https://koalagains.com/stocks/ASX/SIQ

Smartgroup Corporation Ltd (ASX:SIQ) trades at $11.65 AUD with a market capitalization of roughly $1.61 billion AUD, specializing in outsourced employee benefits and salary packaging. [1]

A better company than MMS (pretty much does the same thing??)

📊 Company Overview

Provides outsourced salary packaging
Manages novated leasing programs
Offers end-to-end fleet management
Serves government and corporate clients
Operates under brands like Smartsalary [1, 2, 3]

📈 Financial Snapshot (sept 2026)

Share Price: $11.65 AUD
Market Capitalization: $1.61 Billion AUD
P/E Ratio: ~18.2 (2026-sept)
Dividend Yield: ~3.7%
Revenue (FY25): $329.3 Million AUD [1]

💡 Recent Developments

Active $20 million share buyback program
Stable, recurring revenue business model
Moderate growth forecasts near 3.3% annually
Led by CEO Scott Wharton [1, 2]

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The historical Price-to-Earnings (P/E) ratios for Smartgroup Corporation Ltd (ASX: SIQ) showcase a company that generally trades within a range of 11x to 19x earnings, reflective of its steady position in the salary packaging and fleet management sector. [1, 2]

Below is the historical P/E ratio breakdown for ASX: SIQ over the last several fiscal years: [1]

📊 Historical P/E Ratios (FY 2021 – Current)

Fiscal Period	P/E Ratio	Forward P/E	Period Ending
Current (Sept 2026)	18.02	16.61	Trailing Twelve Months (TTM)
FY 2025	14.93	14.77	December 2025
FY 2024	13.33	13.42	December 2024
FY 2023	18.28	16.64	December 2023
FY 2022	11.24	11.22	December 2022
FY 2021	17.06	15.10	December 2021

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🔎 Context Behind the Trend

Valuation Normalisation: SIQ's current P/E of roughly 18.0x sits slightly above its recent 5-year average. This premium has been driven by a strong post-pandemic recovery and accelerating top-line growth, supported by steady demand for novated leasing under electric vehicle (EV) tax incentives. [1, 2]
The 2022 Low: The compression down to 11.24x in 2022 was a macro-driven anomaly rather than a structural failure. Global supply chain constraints severely restricted new vehicle deliveries across Australia, artificially suppressing delivery volumes despite high consumer order books. [1]
Peer Context: At ~18x, Smartgroup trades at a slight premium relative to its primary competitor, McMillan Shakespeare (ASX: MMS), which historically trades closer to 12x–13x forward earnings. This premium is generally sustained by Smartgroup's lean operational structure and traditionally high Return on Equity (ROE).

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📊 Smartgroup Corporation (ASX:SIQ) ROIC vs. WACC

Smartgroup Corporation's Return on Invested Capital (ROIC) has consistently and significantly outperformed its Weighted Average Cost of Capital (WACC) over the past 10 years, demonstrating strong, enduring economic value creation. [1, 2, 3]

📈 10-Year Performance Overview

Average ROIC: ~13% to 26% range historically (often peaking above 25% depending on the fiscal year's capital structure and earnings). [1, 2, 3]
Average WACC: ~7% to 7.7% range. [1, 2, 3]
Spread (ROIC - WACC): Consistently positive (+6% to +18% spread), indicating high capital efficiency and a durable economic moat. [1, 2, 3, 4]

💡 Value Creation Mechanics

Economic Spread: ROIC comfortably exceeds WACC every single year, proving profitable capital allocation. [1, 2, 3]
M&A Efficiency: High ROIC despite substantial goodwill indicates successful integration of past acquisitions. [1]
Core Driver: Asset-light outsourced administration and salary packaging model generate robust cash flows relative to invested capital. [1, 2]

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