It's way oversold imo. I've been buying more. Simply Wall St have this at £1.81 for fair value. I agree it would be good to see the CEO buying to show confidence, but remember that insiders already own 10.5% of the company, so not insignificant. It's profitable, debt free and has been punished like so many in the tech sector, but even if it's growth slows, it remains profitable and is now trading on a much reduced PE. I'm holding for the long term and my worry, as has been referred to above, is that it could now be a target for a buy out. Just my view. |
suspect likely oversold now in markets full of fear notwithstanding forward trading comments - approx 10p (?) net cash per share - most unfortunate timing of course 2 directors moving on ? Chair is retiring though - replacements coming. growth to slow OK but still growth - must see at least CEO buying shares soon or that wouldn't be too clever - decent current insti holders also - be interesting to see if they add / reduce possibly. |
It is all about the future, and they confirmed in the statement that new orders/demand had softened, at a time when they were priced at 40x PE, I.e. perfection, so the valuation has to come lower to reflect the new reality, growth businesses now command a lower valuation in a higher interest rate/inflation world. |
 Finncap cut forecasts:
"Adjust FY22 and FY23 revenue -3% and -10% respectively; EBITDA unchanged; adj EBIT -4% and -7%; and adj dil EPS -8% in both years"
Traded this short term before but I was regularly flabbergasted at the multiples of these shares, and found it hard to find value last year, as the market went on an all out hell for leather extravaganza.
The reality check now is that if any company on a rich multiple, priced for spectacular growth and a bonanza party disappoints in any way it gets annihilated.
There are alot of examples out there but DOTD follows ESYS as a recent one. Something like PODP got sold on the news and even something on a lower multiple like RCH, which only cut forecasts 6% to 34.2p got smashed too.
You simply cannot disappoint. You have to almost beat forecasts if you're on a big multiple to stand a chance of not getting clobbered in this market. The FED is losing credibility as the market tries to work through the Russian malaise. The overall reality now is that we are all guessing as to how far growth is going to contract in the world and whether a recession will follow.
The experts come on business channels and make their calls, but judging by how wrong most have been, it is all up in the air.
Back to DOTD
FinnCap forecast:
2022 3.8 EPS
2023 4.0 EPS
They also mention that DOTD is one of few independents up for grabs so a takeover cannot be ruled out.
There is an iceberg that has been mopping up at 77p but in a very ugly intraday downtrend. I can see a few orders at 76p and 77p trying to halt the decline but ideally I want to see someone stepping in big to clearout sellers or whopping big director buying (post results season) to move away from very nimble trading - this applies to most out there now.
Longer term folk will clearly approach things differently and might average in on further weakness. Possibly another warning to come judging by this update?
Market cap at 78p is £232m, EV of £192m vs EBITDA forecasts of £20.6m and £21.9m for respective 2022 and 2023.
So barring some major catastrophe going forward, it isn't bonkers expensive anymore so maybe someone will have a look in soon.
All imo
DYOR |
not today - WTF happened on this? |
had this on my watchlist for a while - at what price is this worth a punt ? |
750 mil market cap last summer
incredible |
Anyone understand why this is so far down. I thought the results looked OK. Have I missed anything critical to justify this drop? |
Bought 98pence 21/1/2020 Sold £1.68 on trading update 27/1/22 |
Shagged now! |
 ...from last year...
Company overview:Dotdigital is a SAAS and managed services provider to digital marketing professionals, offering omni-channel marketing automation platform with variety of tools for campaign creation, management, and execution. Founded in 1999, over the years the company has been recognised by different organisations for its products development, ability to inspire, and user satisfaction. Through its 12 offices worldwide the company has generated 21% CAGR and 44% CAGR in revenue and earnings-per-share over the past 10 years. Their organic growth strategy is balanced by acquisitions for complementary synergies and customer base/talent acquisition.
Continuous momentum, strong cash balance and robust growth during FY21 led to total revenue run rate above expectations. The strong performance was evidenced by 588% Engagement Cloud Revenue growth and healthy balance sheet in the H1 2021 presentation. Management has taken the company on the correct path by building on the foundations of company’s international hubs, product enhancement, and adaptation towards changing consumer behaviour....from WealthOracleAM |
Peel Hunt upgrades Dotdigital on price weaknessPeel Hunt has upgraded Dotdigital (DOTD) on weakness in the shares of the sports marketing platform.Analyst James Lockyer upgraded his recommendation from 'hold' to 'add' but reduced the target price from 242p to 170p on the stock, which closed down 0.4% at 144p. He noted the stock has recently derated from its highs.'We upgraded Dotdigital to "add" after the recent weakness,' he said. 'Over the medium-to-long term it is aiming for 10-15% growth, a 20-25% operating margin, and 95% net operating cash conversion.'Lockyer predicted the group would build up a 'cash pool of £64m by 2024'.'Hence, we would not be surprised if Dotdigital made some more tech intellectual property-led acquisitions following the success of the Comapi integration,' he said |
40 million cash - we need an acquisition before we get taken out |
It is very difficult to gauge underlying trends over the past 2 years due to covid and the implied reduction in clients noted above (thank you for spotting that) may in part be a reflection on the number that have ceased trading rather than defected to the opposition.
Reading back on this board to last Autumn, there seems to have been an awareness that the company was on a rating which assumed a phenominal growth rate that was unlikley to be consistently maintained for long even in benign circumstances.
The price/revenue multiple is still high in comparison to many of its peers and is a reflection of its generous margins.
A positive feature of the present update is the excellent cash flow and balance which has increased more in the past six moths than in the whole of the previous full year. Again the operating environment has been unusual and comparisons thereby blurred. However, it does put the company in a strong postion to make bolt-on acquisitions if a favourable opportunity should appear.
In summary, the performance is good but not truly exceptional against a rating that is still high. Strategic position, especially cash, is strong as is the track record so it is reasonable to expect a good relative business performance in its sector. This does not necessarily translate to the share price performance which, on balance imo, is likely to be at best hesitant so that it trades sideways from a slightly lower level for some time ahead.
There is always the possibility of corporate action to raise interest levels. |
Thanks OzzieTom. Much appreciated |
I am a long term holder, but was a little disappointed with todays results.
While revenue grew by 10%, this is a much slower rate of growth than previously and also for what the shares are priced for. Also, although they say they will meet full year expectations, it means H2 revenue will need to be 34.7 million, which may be a stretch. Also, ARPC has increased 19% which is good, but as overall revenue is up only 10%, this must mean there has been a fall in the number of customers. Dividing the revenue for last year (28.2) by ARPU gives 23,578 customers. This years revenue of 30.9 divided by ARPU of 1422 implies 21,729 customers, so a Nett loss of 1849 customers.
I think it is a decent company with a product which seems to be well regarded, but I think it may be overpriced for the level of growth going forward. |
Way oversold this a.m. and I'm not sure why other than market sentiment. I'm a great fan of DOTD and in particular its mngt, so have topped up twice today. I would be interested to hear other's views. |
dotDigital Group plc Trading Update and Notice of Half Year Resul
27/01/2022 7:00am
RNS Number : 8262Z |
On a red day!!! Any indication of why the last two days have been blue? Apart from over selling |
Job done.
Bouncing beautifully.
Currently at 196.6p.
Lob to your heart's content whenever you want :-)
All imo
DYOR |
Watched it, tracked it...bought it
Time for the oversold technical bounce?
All imo
DYOR |
Interesting.
It has gone positive on a notable selling day out there. Bulls are trying to take control of the key 174p and 175p levels.
All imo
DYOR |
Guess that is one way to correct an excitable multiple.
Clearly there has been alot of this exuberant behaviour about this year so surely it cannot be a surprise to see more selling out there and these types of rating's coming back down to Earth.
There were so many of these. You'd look at reports in the morning and think about how steep the multiple's were and take a fright at them. Had to wait for some real clobbering's of late to take an initial bite.
Watching this one for a possible bounce, but it needs a BIG clearout of sellers and that hasn't been happening of late. Seen heavy buying in SUP recently and it hasn't moved. I was watching JSG yesterday and even though you get buyers come in for sizable 200k blocks, sellers just batted them away to prevent any bounce.
So what do we have here:
- Intraday price flat in a firm wider downtrend
- Seller in size sat at 174p closing off any move higher with 175p also providing resistance to the upside.
- Pinged off 170p yesterday so a tight range.
What normally happens (not saying it happens here) in these down moves is that the sellers continue to close off 174p and 175p. Sellers then take control of price points slightly under, and then the market realises the sellers are too overwhelming, and sell through that low yesterday of 170p to continue the downtrend.
Will it happen here?
170p is actually support from earlier in the year so it has already crashed to a key support level so it will be interesting to see if it can hold that level to form a bottom here. The price fell on heavy selling so it's going to need some standout exchanges to peek the interest for a possible bounce.
It doesn't look enticing at the moment, book is stacked like a brick wall on the offer, but IF someone gets the oversized mop out, it could all change.
All imo
DYOR |
No thank you. Growth 23% up and profits up. Very happy. |
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