Dart Group - is this a bullseye stock?

Monday, Mar 12 2012 by

In a previous post I had a quick look at Dart Group PLC. An initial glance at the company suggested that a very defensive balance sheet that generated reasonable returns lay behind a very low valuation.

To be honest, I had forgotten to go back and do some in-depth research of the annual reports. There were three principal reasons as to my neglect:

(i) It has been a favourite of the value investing blogosphere, and has been covered in great detail at ExpectingValue and Valuehunter.

(ii) The company generates much of its returns from its airline division. In the airline industry companies with returns such as Ryanair have been the exception rather than the rule. It has been a dreadful sector for investors.

(iii) I was wary of the momentum. The stock has not participated at all in the risk on/value rally of the past three to four months. It just drifts downwards in a reasonably well-behaved downtrend.

A recent post at Kelpie-Capital has put the stock back on my radar screen once again.

Who are Dart Group plc?

Dart Group PLC is an aviation services and distribution company. The Company is specialized in the operation of leisure aviation services throughout Europe, and the distribution of fresh produce and temperature-controlled and ambient products to supermarkets and wholesale markets throughout the United Kingdom. The Company operates in two segments: Aviation and Distribution. The Aviation division consists of its leisure airline, tour operation and associated commercial activities, trading under the Jet2.com and Jet2holidays brands. The Distribution business, Fowler Welch, is a logistics provider serving the United Kingdom retailers, importers and manufacturers. During the fiscal year ended March 31, 2011 (fiscal 2011), the Company operated over 800 passenger charter flights. Its subsidiaries include Fowler Welch-Coolchain Limited, Jet2.com Limited and Jet2holidays Limited.

Market Capitalisation: £85m

Share Price: 62p

Freefloat: c. 27%


Dart Group is interesting in that the equity has de-rated pretty significantly despite profitability and returns remaining in line with the long run average. It would seem as if this is a stock that has simply been forgotten by the market.

I was initially wary of the industries that the company operates in. Both airlines and distribution are extremely competitive with very low barriers to entry. Return on assets has remained reasonably stable over time, while the return on equity of almost…

Unlock this article instantly by logging into your account

Don’t have an account? Register for free and we’ll get out your way


As per our Terms of Use, Stockopedia is a financial news & data site, discussion forum and content aggregator. Our site should be used for educational & informational purposes only. We do not provide investment advice, recommendations or views as to whether an investment or strategy is suited to the investment needs of a specific individual. You should make your own decisions and seek independent professional advice before doing so. The author may own shares in any companies discussed, all opinions are his/her own & are general/impersonal. Remember: Shares can go down as well as up. Past performance is not a guide to future performance & investors may not get back the amount invested.

Do you like this Post?
6 thumbs up
0 thumbs down
Share this post with friends

Dart Group PLC is a leisure travel and distribution, and logistics company. The Company is engaged in the provision of air travel organizer licensing (ATOL) licensed package holidays by its tour operator, Jet2holidays Limited, and scheduled leisure flights by its airline, Jet2.com Limited (Jet2.com). It distributes temperature-controlled and ambient products on behalf of retailers, processors, growers and importers in the United Kingdom. It operates through two segments: Leisure Travel, and Distribution & Logistics. The Leisure Travel business focuses on scheduled leisure flights by Jet2.com to holiday destinations in the Mediterranean, the Canary Islands and to European Leisure Cities. The Distribution & Logistics business includes the operations of Fowler Welch-Coolchain Limited, a distribution and logistics services provider. Its temperature-controlled operations are in Spalding in Lincolnshire, Teynham and Paddock Wood in Kent, and Hilsea near Portsmouth. more »

LSE Price
Mkt Cap (£m)
P/E (fwd)
Yield (fwd)

  Is Dart fundamentally strong or weak? Find out More »

What's your view on this article? Log In to Comment Now

You can track all @StockoChat comments via Twitter

About jmce


A contrary middle-aged bear that is fervently looking forward to hibernation. After 14 years employed as an investment manager, equity analyst and broker I am now free from institutional shackles. This blog contains my views on equity markets in general and searches for rewarding opportunities in stocks. more »


Stock Picking Tutorial Centre

Let’s get you setup so you get the most out of our service
Done, Let's add some stocks
Brilliant - You've created a folio! Now let's add some stocks to it.

  • Apple (AAPL)

  • Shell (RDSA)

  • Twitter (TWTR)

  • Volkswagon AG (VOK)

  • McDonalds (MCD)

  • Vodafone (VOD)

  • Barratt Homes (BDEV)

  • Microsoft (MSFT)

  • Tesco (TSCO)
Save and show me my analysis