Escher Grp Share Discussion Threads

[the ghost who walks] 22/7/2016 17:11

Seems 5x ev ebitda

[the ghost who walks] 22/7/2016 08:09

Announcement

[the ghost who walks] 14/7/2016 15:28

Interesting. 6.5x ev ebitda

[wexboy] 03/6/2016 16:47

2016 – The Great Irish Share Valuation Project (Part II):

Company: Escher Group Holdings (ESCH:LN)

Last TGISVP Post: Here

Market Cap: GBP 31 M

Price: GBP 167.5p

Oh dear, yet another offensive write-up of mine: With ESCH at 330p per share (having peaked at 395p per share a couple of months earlier), I set a price target of 119p per share! Yup, we have plenty of special snowflakes out there who thought they were the chosen ones to discover what was surely an incredible high margin recurring revenue machine… Maybe so – except I came along & reminded them if doesn’t quack like a duck & it doesn’t look like a duck, it may not be a duck….which they didna’ like at all. And two years later, I’m sure they don’t like the fact I was bloody correct! But eventually you wake up and recognise the timeline & figures just don’t match the story – hence, the relentless decline in the ESCH share price over the last two years.

There’s been a blizzard of contract signings reported, included some new areas of business (like e-government & mobile rewards/payments), but little visible sign of them since. The only obvious positive to report is the increasing level of contracted & recurring revenue, which should reach 50% of total revenue in 2016. That’s great, but unfortunately I predicted a side-effect: ‘One way or the other, the transition will likely present another revenue growth challenge’. And consequently…revenue today is still 11% below FY-2013 revenue.

Cash flow looks better, but that’s due to a substantial swing in working capital – in reality, free cash flow in the last two years was zero. Which means we’re still a long long way from the historic 31% operating margins Escher clocked in the past. Again, we’ll split the difference between FCF & peak operating margins – which suggests a 1.5 P/S multiple is still appropriate, with no adjustments necessary for cash/debt (net debt’s actually $2.7 million):

USD 22.0 M Rev * 1.5 P/S / 1.4623 GBP/USD / 18.7 M shares = GBP 121p

Escher remains fairly over-valued. Unless we see a decisive inflection point in the numbers, the shares will keep grinding lower as disappointed shareholders bail. But last week’s announcement was interesting – Stephen McLeod will be appointed a Senior Independent Director. Regular readers here will recognise him as the former CEO of Universe Group (UNG:LN), which was previously a big favourite & winner for me. In fact, if the CEO Liam Church didn’t own 12% of Escher, I’d wager McLeod was being lined up for an executive post…but even his contribution as a director could prove valuable here.

Price Target: GBP 121p

Upside/(Downside): (28)%

For related links/graphs/files, and more TGISVP analyses/price targets: Google the Wexboy investment blog.

[thomasthetank1] 17/5/2016 13:11

Read Panmure Gordon & Co's note on ESCHER GROUP HOLDINGS PLC (ESCH), out this morning, by visiting hxxps://www.research-tree.com/company/IE00B6SKRB38

"Whilst we leave our FY2016E estimates unchanged we are very encouraged that Escher has de-risked its FY outlook in the wake of signing the Vietnam Post contract. The contract further consolidates Escher’s position as the leader and ‘one to beat’ in the global Postal Authority market – its market share racks up with now the 36th country signature. The contract value appears to be significantly larger than we had expected and involves multiple revenue streams (licence, maintenance subscription and professional services). Also; ..."

[the ghost who walks] 13/5/2016 20:09

Looking good here

[thomasthetank1] 13/5/2016 12:32

Read Panmure Gordon & Co's note on ESCHER GROUP HOLDINGS PLC (ESCH), out this morning, by visiting hxxps://www.research-tree.com/company/IE00B6SKRB38

"The new contract with Vietnam Post shows Escher further consolidate its position as the leader and ‘one to beat’ in the global Postal Authority market. While the contract value was not disclosed, usual in this industry, the deal is likely to be multi-year and involve a number of revenue streams spanning license, maintenance subscription and professional services. We note that the announcement suggests that there is an upsell opportunity. The contract was also likely to have been a competitive win, so Escher again demonstrate..."

[edwardt] 13/5/2016 08:26

another win- valuation must be tempting a buyer here....

[thomasthetank1] 09/5/2016 13:13

Read Panmure Gordon & Co's note on ESCHER GROUP HOLDINGS PLC (ESCH), out this morning, by visiting hxxps://www.research-tree.com/company/IE00B6SKRB38
"News of the new loyalty pilot platform at Saudi Post is an excellent 'upsell' for Escher. It also dovetails into our view that Escher has developed a portfolio of software and services which migrate Postal Authorities from the analogue to digital worlds. We like ‘loyalty’; as it leads to an enhanced digital consumer experience and is a wake-up call for organisations that historically did not need to think about loyalty – now they must..."

[the ghost who walks] 09/5/2016 10:04

Quite positive news coming ot of escher recently but shares weak. Seems someone selling

[the ghost who walks] 09/5/2016 08:19

Exciting announcement

[ride the wave 1] 11/4/2016 18:19

Leg is getting re-rated and the fundamentals are rock solid . Transformational news is due this month so read through the rns and make your own mind up because it will multi bag imho

Watch this CEO interview from 3 weeks ago :-



Also if you look at the daily , weekly and monthly candlestick charts you will see that month on month it's only going one way and one way only . It's also in a golden cross 100dma above 200dma .

ATVB

[the ghost who walks] 09/3/2016 17:40

Seems positive

[deuchar] 04/12/2015 09:09

Surely this is an overreaction they've reduced debt by 40 per cent!

[edwardt] 04/12/2015 08:45

oh dear - not a good one - lets hope it is a delay on license revenue not a loss.

[the ghost who walks] 10/10/2015 17:39

I think this will be a mbo or something

[edwardt] 08/10/2015 09:04

another contract win and precisely nada trades - has this delisted without me noticing??!!

[edwardt] 14/9/2015 12:22

results read pretty well to me and the valuation has certainly cheapened with a clearer path for incremental growth over the next 18 months or so....

[the ghost who walks] 14/9/2015 07:17

Very strong

[the ghost who walks] 08/9/2015 20:38

Agree with that