Share Name Share Symbol Market Type Share ISIN Share Description
Centralnic Group Plc LSE:CNIC London Ordinary Share GB00BCCW4X83 ORD 0.1P
  Price Change % Change Share Price Shares Traded Last Trade
  -1.00 -0.86% 115.50 244,552 16:29:28
Bid Price Offer Price High Price Low Price Open Price
115.50 117.00 118.50 114.00 115.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Software & Computer Services 303.58 1.15 -1.15 331
Last Trade Time Trade Type Trade Size Trade Price Currency
17:14:26 O 1,217 115.50 GBX

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Centralnic Daily Update: Centralnic Group Plc is listed in the Software & Computer Services sector of the London Stock Exchange with ticker CNIC. The last closing price for Centralnic was 116.50p.
Centralnic Group Plc has a 4 week average price of 111p and a 12 week average price of 111p.
The 1 year high share price is 153p while the 1 year low share price is currently 83p.
There are currently 286,160,084 shares in issue and the average daily traded volume is 417,592 shares. The market capitalisation of Centralnic Group Plc is £330,514,897.02.
rivaldo: Nice mention on Friday from Andrew Hore on i.i.i as one of three great AIM stocks to watch: Https:// "Domain name and online marketing services provider CentralNic Group CNIC has been the subject of forecast upgrades this year, yet the share price has still fallen – even if it is by a lower percentage than AIM. The prospective multiple is 10, and that undervalues the potential growth."
rivaldo: June's Techinvest is now out, so it should be OK to copy the conclusion of their CNIC update from the prior issue after their Q1 update (when the share price was 136.75p!): "On the back of this strong start to the financial year, CentralNic expressed confidence that the group will materially exceed the most recent market expectations for the full year. Those expectations were for revenue and adjusted EBITDA of US$516.6m and US$60.4m respectively. In addition to the strong organic performance, the company has continued to add scale and capability through the completion of three strategic acquisitions in the period, including VGL, the largest acquisition to date. In our view, the shares continue to look one of the best value propositions among the London-listed tech sector. Continue to buy."
tole: Group – this company really ticks my criteria boxesBy Mark Watson-Mitchell 27 May 2022 5 mins. to readCentralNic Group – this company really ticks my criteria boxesI consider that the market is missing a trick here.The shares of CentralNic Group (LON:CNIC) are significantly undervalued.They could well rise 50% and still look cheap.My frustrationWhen I look around the market, I see masses of companies whose shares are trading at substantial price-to-earnings ratios, some several times over the overall market average ratings.I see companies that have consistently underwhelmed but whose equities still maintain extremely high valuations based upon 'pie in the sky' high hopes.What I look forMy criteria for Profile selection of companies up to £500m in market capitalisation, include growth in sales revenues, profitability, earnings, dividends, balance sheet strength, management ambition, market share and potential for continuation of the same.Where a company has gone into losses, I take a view on how the management is coping, the reasons for the losses (like early-stage development of a product or services into a chosen market), and then whether the company has a market presence sufficient enough to seek and obtain further funding to carry it on through.Obviously, companies have hiccups along the way, like pandemics, wars, product supply and shortages and similar. That is when you can judge its management backbone and ability.The magic mantraThere are many companies that I look at that have over-ambitious finance directors who give market analysts too rosy a picture and then fail to deliver, using some excuse or another for non-performance.One company boss I know has a distinct mantra – 'under promise and over deliver' – which is why the market has faith in what his management teams have to say about the various companies in which he has been involved.It also explains why he has been able to secure some very appealing acquisitions for his companies, because both the banks and the market approve of his methods and support his efforts..I loathe rubbishAnyway, enough of my investment criteria, readers may well have their own methods that prove more successful.I have stated the above points only because I get exasperated when I see 'total rubbish' getting premium ratings, when 'proper' companies can so often trade well below market averages.Criteria bullseyeOne such example of a company hitting my criteria is CentralNic Group – I consider that its shares should now be trading at around a level of 185p, which is 50% higher than today's price of 125p.And that is at a minimum to what I would consider to be a more proper rating for its shares.So, what does the company do?Lifting directly from the group's own information material –"CentralNic is a London-based company which drives the growth of the global digital economy by developing and managing software platforms allowing businesses globally to buy subscriptions to domain names, used for their own websites and email, as well as for protecting their brands online. These platforms can also be used for distributing domain name related software and services, an opportunity that contributes significantly to the group's organic growth.The groups inorganic growth strategy is identifying and acquiring cash-generative businesses in its industry with annuity revenue streams and exposure to growth markets and migrating them onto the company's software and operating platforms. CentralNic operates globally with customers in almost every country in the world. It earns recurring revenues from the worldwide sales of internet domain names and other services on an annual subscription basis."The group provides domain name services worldwide.It operates through Online Presence and Online Marketing segments.The company's Online Presence segment provides tools for businesses to go online, such as reseller, registry operator, registry service provider, retail, and computer software channels, as well as strategic consultancy and related services.The company's Online Marketing segment offers advertising placement services for domain name owners, content website operators, and e-commerce website operators.It also provides social marketing, search engine marketing advertising, and display advertising services, as well as selling domain names to registrants. It ticks my boxesAs far as I am concerned this company ticks all of my boxes.It obviously ticks the boxes of a number of professional and institutional holders.Its owners list includes Kestrel Partners (21.8%), Gmbh (12.9%), Slater Investments (9.11%), JTC Private Banking (6.03%), Canaccord Genuity Wealth (5.89%), Erin Invest & Finance (5.48%), Edmond de Rothschild Asset Management (France) (5.48%), Chelverton Asset Management (5.20%), and Schroder Investment Management (3.95%) amongst many others.With its 288.67m issued shares trading at 125p, the group is capitalised at £362m.Latest Trading UpdateOn Monday of this week the company announced a Q1 Trading Update for the three months to end March.Revenues were up 86% to $156.6m ($84.4m), its adjusted EBITDA was 83% better at $18.5m ($10.1m), its operating profit was $10.0m ($1.4m), while its net debt was down 18% to $61.3m.The figures reflect the potential of its strong marketplace for Online Presence and Online Marketing services.CEO Ben Crawford stated that:"CentralNic has enjoyed a strong start to the year with year-on-year organic growth now reaching north of 50%, gaining market share in a growing market.At the same time, we have continued to add scale and capability through the completion of three strategic acquisitions in the period, including VGL, our largest acquisition to date, funded by an oversubscribed equity placing and tap bond issue.With notably reduced leverage and a healthy cash cushion, CentralNic remains well positioned for the future."Broker's ViewsThe group's NOMAD and broker Zeus Capital stated that the Update showed that the group was 'positioned to outperform' with its analyst Bob Liao forecasting strong growth ahead.His estimates for the current year suggest revenues of $573.4m ($410.5m), with its EBITDA rising from $46.3m to $67.0m for the year to end December 2022. That should see earnings coming out at 16.5c (11.8c) per share.Conservatively, and without any acquisitions, he goes for revenues to rise to $607.3m next year and $643.4m in 2024, with EBITDA of $72.3m and $76.1m respectively, lifting earnings up to 17.7c then 19.1c in 2024.My ViewStraight after the Q1 Update on Monday the shares hit 141p in reaction to the positive news.The highest that they have been in the last year was 153.75p last November.That was well before the well oversubscribed £45m fundraising in early March for the $75m acquisition of VGL, the German online marketing group.With the bulk of its revenues earned globally and enjoying significant annually recurring revenues, this group is a 'real money machine' that is not to be ignored.I consider that its shares are trading at two-thirds of what would be an average value, when in fact they rate a premium valuation far higher.That will happen in due course, I am sure.And that is why CentralNic Group is currently my top-ranking Profile selection.I see them easily hitting 185p in due course.These shares are a steal at around the current 125p.
se81: The growth here at CNIC looks even more appealing if you have a read through those FUTR numbers this morning.... FUTR also another good example of a huge rerate in share price in the absence of statutory profits ;)
rivaldo: Hi diesel. Not having a go at anyone, but a one-liner without any back-up rationale and ignoring the cash generation, the m/cap as a whole relative to the debt and the rapid debt payback seems to me to be unlikely to be the cause of the share price hiatus. As Robsy2 says, debt given CNIC's cash generation is a good thing, and indeed is a sign that the company is utilising its available non-equity funding well. Given the rise in recent years from 35p-40p there are multiple institutional and other holders with good profits. Perhaps it's as simple as some of these holders drip-feeding out stock over a long period, and/or some of the 120p placees taking a few pence profit - it was noticeable that when the share price reached 125p-127p that level was quickly taken advantage of. Plus of course the markets at present are awful, so any company reasonably holding its own if not surging is doing OK. Patience is required imo until the seller(s) are out.
rivaldo: Jack Brumby from Stockopedia, who holds CNIC shares, met with management a couple of days ago and made some useful notes - here they are: "Jack’s section Centralnic (LON:CNIC) Notes from meeting with management I hold No surprise that revenues are again up 71% to $410m as this is in keeping with a revenue CAGR of roughly 73% since IPO. But, importantly, a lot of this growth is now organic (39% according to the update, up from mid single digits a few years ago and 9% in FY20). This follows years of significant work and investment into staff and systems, plus a centralised head office function that gives managers more freedom to grow their businesses. The other big factor is the impressive growth in online marketing. Today’s announcement marks the fourth acquisition here, one which significantly grows the scale of this segment. Group adjusted EBITDA is up c60% and cash generation is up c50%. Operating profit is also up, so the revenue growth is dropping through to profits. Online Presence – infrastructure online – is generally annual subscription products. Every company buys a suite of products amp; renews every year. Online Marketing, however, sees CNIC paid every time the client wins a new customer, so the cadence can be many times every day. It’s also a far greater addressable market at c$400bn. The company continues to be well positioned as Big Tech focuses on privacy. Balance sheet Net debt to EBITDA ratio is 1.6x and needs to be under 2.5, so CNIC is comfortable at these levels. It’s recurring cash generation gives interest cover of c4.5x and, given the nature of the company, perhaps these are the most important metrics against which to gauge debt. This is a very asset light business. There’s just no need for factories, inventory, etc. hence the lack of tangible assets. Intangibles is a large line item but this all comes from acquisitions. When you acquire a business, you allocate against assets, and when there’s no tangibles then it is classified as goodwill. Cash and receivables are a big part of the business, and the group’s cash generation is a more important point to consider. Cash is generated fairly consistently – there are no big swings from, say, a key trading period that a retailer might have, so the figures we get today are a good indicator of the scale of the enterprise. Cash generation has been above adjusted EBITDA every year since IPO. Customers must prepay amp; CNIC receives credit from suppliers – a favourable dynamic that leads to strong cash generation. EPS It’s fair to adjust the EPS as there’s a big chunk of amortisation relating entirely to intangible assets, so it’s not something that impacts on cash and is primarily a function of acquisitions. If the company stopped making acquisitions, these non-cash costs would fall away. There are non-core expenses that fall below the EBITDA line, also driven by Mamp;A. Again, the company could switch these off if it decided to stop acquiring, so they are not underlying costs. They’re also becoming a smaller and smaller part of EBITDA and this trend will continue. Adjustments could end up around 10% of EBITDA in future. EPS +18% reflects strong growth in lower margin products, so it’s an expected change in mix; everything is holding its margin and the key thing is that EPS is going up. Operational costs – CNIC is growing so fast that there will be spend here, but operating costs should go up at a fraction of revenue growth because of the ‘platform̵7; nature of CNIC’s businesses. There is a degree of scalability here, and the prospect of operational leverage. VGL acquisition This is a product comparison website company, similar to Which. It has a content team keeping product comparisons up to date, and brings in a commission from ecommerce companies once customers click through to their sites and make a purchase. It has tens of millions of customers making purchases and is the market leader in Germany, which is a concentrated market. $11m EBITDA from $55m revenues, so a healthy 20% margin, meaning the acquisition is not just double digit earnings accretive but also margin accretive going forward. The placement raised £42m, and the open offer ensures that any investor can hold their corner and enjoy same pricing. Management has listened to retail investors here. There is a small additional tranche of debt but this is proportionate. The bonds are issued at premium to the listed price so the effective interest rate is 4.3%. This bodes well for any debt renegotiation, which could happen from July onwards and could result in lower interest payments. CNIC gets content creation expertise from VGL which is very helpful for its online marketing business. The group can also monetise the acquired traffic from the new websites, and VGL has some valuable relationships with ecommerce companies. So the transaction is helpful on multiple fronts. CNIC operates in large, growing markets. The smartest way to address the opportunity is have access to lots of big traffic businesses, which it can buy. There’s scope to continue to do that rapidly due to CNIC’s strong finance and technology teams. It has the expertise to identify and integrate acquisitions, which also diversifies group revenue. So it expects to continue moving forward via acquisition and organic growth in order to create a company of substantial scale."
rivaldo: The long-term chart shows the share price advance here. Since I first bought in at around 45p-50p (from memory) there's been continuous progress and growth at CNIC. Look at the share price graph in 2020 - and note what's happened subsequently. After such a rise there was bound to be a consolidation phase. With every analyst showing fair values far above the current share price, you may be over-thinking at just the wrong time.
sev22: Tipped in the Investors Chronicle today: Marketing and M&A driving growth at CentralNic. Marketing product doesn't rely on third-party data which makes it appealing, given Apple and Google's recent move to crackdown on data tracking. *Strong start to 2022 *Cash conversion at 116 per cent CentralNic’s (CNIC) strategy of investment during the pandemic has delivered strong results. The highly acquisitive advertising and domain business delivered adjusted cash profit growth of 57 per cent to $46.3mn (£34.5mn). However, due to a £42mn share placing at 120p – 9 per cent below its share price at the time – the share price dropped 6 per cent on the morning of the announcement. The cash from the placing was used to acquire German online marketing business VGL Verlagsgesellschaft for $75mn. The acquired company provides comparison content and reviews and is expected to be immediately accretive before any synergies are realised. CentralNic started out buying and selling domain names. However, in the last three years it started focusing on marketing, using its visibility of domains to match buyers and sellers of advertising. Marketing now makes up 64 per cent of total revenue, up from 47 per cent last year. The strength of its marketing business is that it doesn’t rely on tracking people’s data so there isn’t a risk of losing business because of the third-party data changes made at Apple and Google. Increasing economic concerns due to inflation and the conflict in Ukraine mean total global advertising spend could fall. Historically, GDP and advertising spend have been closely correlated. However, management thinks that digital advertising is so crucial to businesses nowadays that this relationship is no longer as strong. FactSet broker consensus 2023 EPS is 10.3p, a 20 per cent increase. This gives it a very affordable 2023 price/earnings (PE) ratio of 12.1 – especially compared with US rival GoDaddy, which currently trades on a 2023 PE ratio of 30.2. Buy.
rivaldo: Hi martindjzz. Web marketing economics are (unsurprisingly) not my speciality either! Google are of course a large revenue contributor for CNIC, especially via domain monetisation. CNIC have consistently shown great skill in navigating any such risk areas for some years now - as proven by their share price performance (indeed the share price is up some 40%-50% since the time I remember Simon sold). As specialists in their field one would hope they would be fully aware of any forthcoming changes and adapt accordingly. There are at least two analysts who see share price upside of from 50%-80% from here up to around the 260p or so area. No-one can predict the future, but they evidently don't see any problems in that area in arriving at those valuations.
rivaldo: Excellent new interview with the CEO by Edison over 13 minutes. Lots of serious discussion and relevant questions - much better than the usual superficial three minute interviews. Good to hear that we should continue to see a number of acquisitions, probably of smaller entities since the large sector peers and targets are more difficult to ensnare and are largely valued at multiples far above CNIC's (showing the disparity in valuations which Berenberg and Stifel have recently highlighted, with their target prices being double the current CNIC share price)! Https:// Cheers Mas.
Centralnic share price data is direct from the London Stock Exchange
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