Equals Share Discussion Threads

[flagon] 15/8/2023 09:16

Noticed on LinkedIn that Equals Money have a number of job openings on site in Holland. I note Dutch global bank ING is a partner.

[colinroberts] 11/8/2023 10:58

That's my thought, unless there's an RNS out of the blue.

[ashleyjv] 11/8/2023 10:21

I'm guessing that not much will be happening here until 12th September 2023 when we get the interims and trading update

[clive7878] 20/7/2023 12:54

future 15 is about right I can see, some of this years growth maybe already built into the share price, but it could rise futher with more good growth figures. The stock is looking good value.

[eagle eye] 19/7/2023 12:22

simso,
Zeus has forecast revenue of £89m, PBT of £11.5m and EPS 4.7p for the current year to Dec23.
Next year's forecast revenue is £105m, PBT of £15.5m and EPS of 6.3p.
All the points you raise are valid, but it looks like the figures you've quoted are for the year ahead.
Hopefully the upgrade won't be far short of next year's forecast anyway :-))

[simso] 17/7/2023 09:40

Not sure where your numbers come from Clive. Zeus have a forecast adjusted profit for this year of £15.5m and EPS 6.3p so the P/e is just over 15. Even this rating does not tell the full story though, as there are two other factors to bear in mind:-

1) Zeus acnowledged in a note last week (available on Research Tree) that when the Interims are announced on 12 Sept "We will increase our forecasts". I should think so too, with £45m revenue secured in H1, their FY sales of £89m for full year looks out of date. Also, their existing forecast has only +1% of Gross Margin Growth, while we now know the first half rate of travel is more than 3% points higher. Perhaps a £1m off for Oonex, which they expect to becomes accretive next year.

2) Forecast closing net cash is £35m ...around 20% of the Market Cap. The "cash adjusted" P/e is therefore closer to 12*, on a forecast which looks certain to be raised.

Valuation looks ridiculously low to me, given the consistency of the growth and prospects, particiularly after Oonex opens up the European Market.

[johndoe23] 17/7/2023 07:58

Forward PE is around the 15 mark.

[greenknight1] 17/7/2023 07:55

Not a good post Clive

[clive7878] 16/7/2023 21:44

Equals recommended as a buy in the IC again this week.
Their EQLS share price forecasts range from GBX 150 to GBX 164. On average, they expect the company's share price to reach GBX 157 in the next twelve months.
Hargreaves Lansdown says pe is 28, but £180m capitalisation and £3.24m profit = 28 ?
SP seems very highly rated to go up another 50%, although growth rating is said on Simplywall to be .35%.
Is the IC telling the whole story, or missing points out.

[anon12345] 15/7/2023 14:40

Masurenguy - agree on Wise, I've had the same thought. Scale is everything in payments and it's nonsensical that a quality B2B payments business organically growing ~40% trades at a single digit EBITDA multiple - either the public markets rerate EQLS up significantly, or it'll get acquired (there's plenty of others aside from Wise who'd buy it).

Would also note Ian's obviously aware of the disconnect between public and private market value of EQLS (he's referenced it in presentations, interviews etc.), and being in his early 60s he is going to want an exit at some point.

[masurenguy] 15/7/2023 13:44

"International payments firm Wise is “one of the few firms actually benefiting from... interest-rate hikes”, which allow it to turn a profit on dormant customer cash balances. The number of active customers increased by 34% in the year to 31 March, with two-thirds joining through word of mouth, the cheapest form of marketing. Given rising global migration, there is structural demand for its services. Buy (613p)." Investors Chronicle.

"There is the huge scope for providing a white-label money transfer service to banks, which then offer it under their own brand. Kaarmann (Wise CEO) has just signed up Indonesia’s biggest bank by assets, Bank Mandiri. “Each quarter we’ve been reporting chunkier and chunkier deals.” One day, he hopes the mainstream UK banks will succumb to his service." The Times

The above just reinforces the point that I made here circa 3 months ago. Wise is focused on the consumer but would like to extend their coverage into the banking sector. Equals is focused on the banking sector rather than the consumer so they are primarily complementary rather than competitive at this point in time. Equals, with a market cap of circa £180m, is just 2% of the Wise market cap of £9.6bn. If Wise want to break into the banking sector maybe they should look at acquiring Equals! - the cost would be petty cash to them!

[masurenguy] 15/7/2023 08:36

At the year end on December 22 they were in a net cash position of circa £14m.

[swiss paul] 14/7/2023 20:46

whats the debt situation in EQLS?

[66fingers] 13/7/2023 21:04

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small companies
Equals in line for further earnings upgrades
This Aim-traded firm has delivered eye-catching growth but is only valued on 8.5 times cash profit estimates
Equals in line for further earnings upgrades
July 7, 2023
By Simon Thompson

43 per cent growth in first-half revenue to record £45mn
Gross margin up from 47 to 50 per cent
Average revenue per day hits all-time high of £363,000
20 per cent full-year cash profit margin guidance, up from 17.4 per cent in 2022

Aim-traded fintech payments group Equals (EQLS:100p), a leading challenger for banking and payments, has released a bullish pre-close trading update that opens the possibility of earnings upgrades at the interim results on 12 September.

Average revenue per day increased 42 per cent to £363,000 year on year and at a 3 percentage point higher gross margin of 50 per cent, implying first-half gross profit of £22.5mn on revenue of £45mn, up from £14.8mn and £31.4mn, respectively, in the first half of 2022. The combination of rising revenue and margin expansion explains why profits from the operationally geared business continue to outpace revenue growth. This is not being priced in.

[66fingers] 13/7/2023 20:56

I kept trying on Firefox and persevered in the end without adjusting any settings.

[allstar_07] 13/7/2023 20:29

Does firefox only work on pc as still is blocked on mobile app or do you need certain settings?

[66fingers] 09/7/2023 23:55

Hi petewy, success, managed to access the article. Many thanks for the tip about Firefox and the Equals article.

[squeakeasy] 09/7/2023 19:01

..and that works. Very useful and positive review of last week's numbers. More positive than the main brokers covering Eqls

[petewy] 08/7/2023 23:07

get Firefox to ingore paywall

[66fingers] 08/7/2023 22:32

Hi petewy, thanks for sharing the link but unfortunately the article is hidden by a pay wall. Thanks again for sharing.

[petewy] 08/7/2023 16:46

66fingers TRY using Firefox

[amt] 06/7/2023 20:33

Wow so possibly over 1 billion market cap in a couple of years.
Added it to my ten bagger list

[qs99] 06/7/2023 18:57

Thanks Anon, that again is a cracking post, I haven't had time to look in detail so it really helps. Have a good evening.

So at c.£180m market cap, growing at right angles, generating even more cash, TAM widening big time, it won't take long IMO for it to start hitting c.£50m EBITDA in next 3 years....all to play for. DYOR

[anon12345] 06/7/2023 16:06

The other detail in yesterday's TU was the 20% EBITDA margin guidance for FY23, which explicitly includes the losses from Oonex. Oonex lost £2m in FY22 and Equals would likely be increasing that loss in the short term by growing headcount necessary to support operations.

Based on that, I think FY23 guidance is something like £100m revenue, £21-22m EBITDA from existing operations, and £1-2m losses from Oonex. The Oonex losses should swing quickly to profits in FY24, and added onto the existing business' growth should mean that current FY24 EBITDA estimates (£22.5M) will be revised up very significantly.