Capita employee data speaks volume

[WalbrockResearch821]

Capita declining share price didn’t happen because of problems in the past few years, but occur much earlier (you are talking about the time during the financial crisis). By using secondary metrics like Sales per employee, you would have noticed that productivity per staff has stalled and was experiencing a gradual decline.



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Another interesting observation, which could disrupt the way we analysis market valuation is to pick the most important financial/non-financial data. For Capita, it is their employees.

So, what you do is divide the employee numbers by market capitalisation to get market capitalisation per employee. Then you divide employee numbers by normalised profits to get normalised profit per employee.
Next, divide Market Capitalisation per employee over Normalised profit per employee to get multiple. Much like the PE ratio, a low number signals cheap valuation and vice-versa.

You measure that against Capita’s share price to achieve this correlation.


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This gradual internal inefficiency has led to their share price decline.

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Have resurrected this thread. With added note about ownership by Wallbrook. Raptor.