Kape Technologies Share Discussion Threads

[qs99] 01/4/2020 15:55

yup, looks like heading back towards that £2 mark, well done Riv and the team

[malcolmmm] 01/4/2020 14:56

Up she goes

[rivaldo] 01/4/2020 11:19

Bouncing nicely.

There's a second tip for KAPE today, this time from Progressive Equity Research, who highlight some stocks "whose business models are well adapted to these changes, or who might see a change in long-term structural demand".

They summarise KAPE as follows:

"Kape – one of the few to already announce usage uplift, Kape has seen growth in the sale of VPNs in recent weeks, mainly in the US and Europe, from people keen to protect their increased domestic online activity."

[johndoe23] 01/4/2020 08:57

Quoted 161.8p to buy 10k

[malcolmmm] 01/4/2020 08:53

cant buy any though

[johndoe23] 01/4/2020 08:47

Strange how this and other stocks which are actually defensive in these times are sliding today. Just goes to show, when most panic sell...

[qs99] 01/4/2020 08:45

indeed....may throw off a dash for cash again and opportunities to pick stocks up cheaply,.....let's see....LLOY/BARC getting rid of divis won't help

[johndoe23] 01/4/2020 08:35

Markets sliding again...

[qs99] 01/4/2020 08:24

Looks like profit takers are out in force....

[qs99] 01/4/2020 07:52

Thanks Riv.

I sense the markets are going to be off again soon now quarter end balancing of books has gone...let's see....DYOR

[rivaldo] 01/4/2020 07:51

David Kempton on Citywire has tipped KAPE this morning:



"I have also bought back into Kape (KAPE) on the basis its cyber security software will enjoy strong increased demand from the new army of home workers. Home Wi-Fi and personal laptops are much more susceptible to cyber attack.

Last Autumn Kape bought LTMI, a leading US-based digital privacy company with more than one million paying customers. The doubling of Kape’s customer base to 2m globally is forecast to increase 2020 profits nearly 10 -old for a PE of 12 and 0.1 PEG."

[adamb1978] 31/3/2020 11:28

Capital IQ shows an average of 19x NTM PE average since 2015, with a high of 36x.

Setting that aside, I'd judge a likely PE multiple based on experience. What sort of multiple would I expect a c.20% growth software company be valued at? Important to also realise that the scale which Kape are getting to enables economies of scale to take margins into the 25%-30% range, and therefore throw off more cash, as opposed to the much lower margins when it was a $50m revenue company

[ali47fish] 31/3/2020 10:53

where do you get your multiples- sharecast has this, so why are you saying 25 to 30?
hxxps://www.sharecast.com/equity/Kape_Technologies
13.3 for 2020
11.7 for 2021

-

[adamb1978] 31/3/2020 10:43

Tygarreg

When I buy small-caps, at this point in the cycle I want to be thinking that I could double my money on a 2-3 year basis. For Kape, I think they could grow their 10-11p EPS in 2020 by 20% p.a. and then putting that on a 25x PE, gets you to 450p-500p. Achieving 20% growth PE could easily lead to a PE of >30x.

Taking a more conservative scenario, 10% p.a. growth and a midpoint of a 15x-20x PE range gets you to 250p.

Adam

[rivaldo] 31/3/2020 10:05

In the USA the sky is the limit. In the UK one could hope for a multiple of 25-30 for a company with high recurring revenues, continuing growth potential etc - especially one which has proven itself over a period of time.

Arden and N+1 Singer have both this morning sensibly retained their forecasts of 13.9c and 13.5c EPS, whilst noting that today's RNS gives headroom for those forecasts to be reviewed/upgraded later in the year.

So there's plenty of upside from the current share price over time imo.

[johndoe23] 31/3/2020 10:05

Think current pe is around 12, so for me between 18-20 times earnings is fine for a growth stock...

[tygarreg] 31/3/2020 09:52

What is the normal multiple of earnings for a high tech company like this to be valued at?

[adamb1978] 31/3/2020 08:45

Qs99

I agree that markets overall arent pricing in the economic damage which has been done, nor pricing in the actions which the US will belatedly have to take to control CV. I think the support for overall markets for the last week is short covering and portfolio managers needing to increase equity exposure back to target levels for quarter end after they were hammered over the last month or so. I could see a lot of short term market weakness over the next month, starting with unemployment data in the US this week.

That said, a positive trading statement like this should mean KAPE outperforms the market even if the overall market falls 20%. There's no way I'd be selling KAPE at these levels.

Adam

[qs99] 31/3/2020 08:40

I still think this and markets could be v. volatile....don't reckon market has fully priced in the economic effect of all this yet, or the debt etc.....have taken some off the table as cash is king at the moment.....DYOR and am still a big fan of where KAPE is heading don't get me wrong...

[squintyflinty1] 31/3/2020 08:32

Very reassuring RNS

[qs99] 31/3/2020 08:27

NIce and thanks for the info above mr numpty

[johndoe23] 31/3/2020 08:18

This should be the catalyst it needs to get to 200p, and beyond!

[suetballs] 31/3/2020 08:18

Adam - my sentiments too.
Suet