Loopup Share Discussion Threads

[rimau1] 28/7/2020 15:00

Expecting a bullish Detailed operational update tomorrow Which should demonstrate that momentum has continued into July, that WFH is expected to continue for the foreseeable future and most importantly i want to be proved right that £65m is very doable this year. We could get further upgrades and a continued rerate on the back of tomorrow. I shall start taking some profits from the 90p days when we reach £2.50 but my year end price target is £3.20 or 3 times revenues. This is so cheap, still.

[sjgadvfn] 28/7/2020 13:43

Buys ahead of tomorrow's operational update.

[investographer] 28/7/2020 12:53

Some consistent buying today....

[bigbigdave] 23/7/2020 06:46

How critical will #remotemeetings become for law firms in the future? #Legal professionals believe remote meetings will become even more important for external comms with clients in the next 3-5 years. Given this shift towards remote work, it is essential law firms are set up with the right tools!

[thordon] 22/7/2020 22:19

Someuwin

Yes totally agree we work for a multi billionaire company and keep defaulting to loopup system.

Skype business and Microsoft teams so far

If we can not get internet connection then Loopup is the only way to communicate

[maddox] 22/7/2020 21:39

@someuwin, Good input - would you mind sharing what sector your Corp is in?

@rimau yes, I think there is being cautious, not a bad thing, and then there is just plain ridiculous.

Regards , Maddox

[rimau1] 22/7/2020 13:12

The analysts are still way behind here. I modelled £65m revenue back in april when we were 80p. The current upgraded consensus of £56m assumes H2 2019 revenues plus £1m!!! Crazy. When the market realises that we will do closer to £65m the rerate will grow at pace. The bear case is weak - how sticky the new business wins are/competition in a hot sector and when do people get tired of WFH.

[someuwin] 22/7/2020 09:00

The large corporation I work for has, like all companies, had to adapt to new communications technologies. Skype, Zoom, Webex, MS Teams etc. But the default method we keep coming back to for team meetings / conversations etc is Loopup. It just seems easier and more convenient. Can't see that changing any time soon. And if they keep adding more functionality will be even more popular.

Will keep growing until it gets bought out imo.

[bigbigdave] 22/7/2020 08:42

Where is that from Thorndon?

[thordon] 21/7/2020 20:07

The Covid-19 enforced lockdown has forced millions of organisations to adopt remote working practices, providing a boom for remote conference meetings companies and one that could signal a major structural change in working arrangements longer term.

That’s the key reason why I suggested buying shares, at 138p, in LoopUp (LOOP:179p), a London-based premium remote conference meetings company (Alpha Report: ‘Tap into the remote working boom with LoopUp’, 2 July 2020). The company offers its information secure, reliable and easy-to-use remote conferencing technology to customers in key professional service verticals (law, accountancy, investment banking, corporate finance, private equity, asset management, insurance, PR and marketing). The client base includes more than 20 per cent of both the AmLaw Global 100 firms and the world’s top-100 private equity firms. With offices in North America, Europe, Hong Kong, Sydney and Barbados, LoopUp’s geographic footprint covers the world’s major business capitals.

A trading update at the tail end of last week highlights just how these secular trends are increasing the number of users, and profitability, too. LoopUp’s first-half revenue soared by 43 per cent to £31.9m, and on four percentage point higher gross margin of 71.5 per cent. Moreover, with overheads lower year on year, the operational gearing of the business really kicked in, so much so that first cash profits (earnings before interest, taxation, depreciation and amortisation) soared by 249 per cent to £12.2m.

Analyst Peter McNally at brokerage Panmure Gordon had been forecasting a cash profit of £10.7m on revenue of £50m for the whole of 2020, so has been forced to push through material earnings upgrades. In fact, based on what still looks like conservative upgrades, Panmure now forecasts annual revenue rising by 31 per cent to £56m to deliver cash profit of £16.9m (2019: £6.4m) and pre-tax profit of £10.2m (2019: £0.5m). On this basis, expect earnings per share (EPS) to rise from 2.2p to 15.1p, implying the shares are rated on a modest forward price/earnings (PE) ratio of 12, a hefty discount to the UK Small-Cap Technology sector average of 17.6.

It’s worth noting that with cash profit building so quickly net borrowings have been slashed by more than half from £11.4m to £5.4m since the start of 2020, well ahead of Panmure’s year-end estimate of £7.6m. This means that more of the economic interest of the enterprise can now be attributed to shareholders. The debt reduction also reduces interest costs, thus boosting net profits.

LoopUp’s share price has surged by 29 per cent to 179p since I published my Alpha Report and is well on the way to achieving my initial 225p target. Given the scale of the upgrades, the share price risk is clearly to the upside. So, ahead of the company’s operational update on Wednesday 29 July, I continue to rate the shares a strong buy.

[lyndon b] 21/7/2020 19:44

It is eye balling £2 as the first step. Happy days.

[thirty fifty twenty] 20/7/2020 18:19

i think it must be very hard for any analyst to forecast profits here accurately as it involves assumptions regarding people's reaction to the continuing existance of threat from a virus and also how they have changed behaviours based on the working from home experience.

after the H1 results we can now see that LOOP is it a huge inflection point and that profit and cash flow is very materially geared to small changes in sales.

i think the points in the progressive article are reasonable valid.. i.e. customers will try some sort of re-negotiation after the big cost increase but also think that they are paying for a premium service and the cost is tiny and IMMATERIAL to the cost of people time at the meeting so i dont think it will be a major priority for the world's largest private equity houses to reduce their telephone bill by 5,000 per annum.

in my modelling of LOOP i have done the detail and factored in my assessment of 'return to the office' but also i have taken a simplistic approach and looked at saying if LOOP continues to grow as it has done for many years what would that be....

my baseline is 10% per annum which seems ridiculously conservative, but doing that gives EBITDA of 15m for 2021 with a net CASH position. I think a growth, CASH generative business, with net CASH would easily be valued at 10t EBITDA i.e. 150m (280p). taking 15% pa. gives 18m EBITDA for 2021 and at 10t implies a share price of 380p.

of course things can go wrong but LOOP, IMHO, offers an exceptionally possibility that it could reach these dizzy heights backed by real CASH flows.

for me too the chart shows an exceptionally strong Head & Shoulder bottom which easily supports the potential to reach 380p within 12 months.

not sure why Jupiter would be selling out but think when that overhang is cleare the potential is very material.

All IMHO, DYOR + BoL
LOOP is in my top5 hldgs

[investographer] 20/7/2020 13:35

Huge increase in volumes

[maddox] 20/7/2020 12:50

Hi rimau,

Agreed I think the Analysts are being cautious for the reasons I mentioned above. But at least Simon Thompson has better captured LOOP's market proposition and positioning accurately. Progressive's report doesn't manage to do that - even though as FrugalTree correctly points out, it is paid-for coverage by LOOP.

[rimau1] 20/7/2020 12:33

I am a little more bullish than the recent analyst upgrades. Here is an extract of the ST article, nothing new or exclusive but an interesting read nonetheless

“The company offers its information secure, reliable and easy-to-use remote conferencing technology to customers in key professional service verticals (law, accountancy, investment banking, corporate finance, private equity, asset management, insurance, PR and marketing). The client base includes more than 20 per cent of both the AmLaw Global 100 firms and the world’s top-100 private equity firms. With offices in North America, Europe, Hong Kong, Sydney and Barbados, LoopUp’s geographic footprint covers the world’s major business capitals.

A trading update at the tail end of last week highlights just how these secular trends are increasing the number of users, and profitability, too. LoopUp’s first-half revenue soared by 43 per cent to £31.9m, and on four percentage point higher gross margin of 71.5 per cent. Moreover, with overheads lower year on year, the operational gearing of the business really kicked in, so much so that first cash profits (earnings before interest, taxation, depreciation and amortisation) soared by 249 per cent to £12.2m.

Analyst Peter McNally at brokerage Panmure Gordon had been forecasting a cash profit of £10.7m on revenue of £50m for the whole of 2020, so has been forced to push through material earnings upgrades. In fact, based on what still looks like conservative upgrades, Panmure now forecasts annual revenue rising by 31 per cent to £56m to deliver cash profit of £16.9m (2019: £6.4m) and pre-tax profit of £10.2m (2019: £0.5m). On this basis, expect earnings per share (EPS) to rise from 2.2p to 15.1p, implying the shares are rated on a modest forward price/earnings (PE) ratio of 12, a hefty discount to the UK Small-Cap Technology sector average of 17.6.

It’s worth noting that with cash profit building so quickly net borrowings have been slashed by more than half from £11.4m to £5.4m since the start of 2020, well ahead of Panmure’s year-end estimate of £7.6m. This means that more of the economic interest of the enterprise can now be attributed to shareholders. The debt reduction also reduces interest costs, thus boosting net profits.

LoopUp’s share price has surged by 29 per cent to 179p since I published my Alpha Report and is well on the way to achieving my initial 225p target. Given the scale of the upgrades, the share price risk is clearly to the upside. So, ahead of the company’s operational update on Wednesday 29 July, I continue to rate the shares a strong buy.

[maddox] 20/7/2020 12:01

LOOP tipped by Simon Thompson as predicted.

[frugaltree3] 20/7/2020 11:09

Progressive is paid for research, paid for by LOOP. So the forecasts and commentary will be heavily influenced and agreed with LOOP. Not sure they would allow a misunderstanding to be published.

Interested to hear how they respond to the question on the 29th though. Also, they are nicely into an upgrade cycle now and i wonder if they are still low balling the forecasts - that would be very sensible and another upgrade would start to draw a line under the profit warning that tarnished this one last year.

It was tipped by IC recently, so they will probably take a lap on honour and tip it again this week!

[maddox] 20/7/2020 10:53

Hi Bigtime,

Anyone can sign-up for Progressive Equity Research and get a copy.

Whilst they are positive and have upgraded I think that they have missed understood what is going on with LOOP. They foresee some pricing pressure from customers looking for volume discounts and switching to cheaper platforms like MS Teams. No doubt some of this is occurring. However, I believe the strong performance is as a result of switching from those cheaper self-service broadband channel providers towards a better quality premium service as online communication becomes more crucial.

This is something I will seek to checkout on the 29th.

Underlying this is there is I think a disbelief that a UK firm can actually survive let alone prosper against the US giants - an inferiority complex. When this disbelief is removed the shares will soar.

[big7ime] 19/7/2020 16:02

Analysis from Progressive Equity Research ...

Unable to post full report but they have materially upgraded 2020 and 2021 forecasts
“We increase our revenue estimates by 11% and 6% for FY 20E and FY 21E respectively. Adjusted EBITDA numbers increase by 60% and 12% for the same years.”
And Summarise-
“This is an extremely strong update from LoopUp, highlighting a very profitable period for the group in H1, with positive signs that much of the improvement will persist into the future. We look forward to additional detail in the Operational Update towards the end of July.”

[parvez] 17/7/2020 08:54

Lyndon, might be more "nice days at the office" over the next few days/weeks

[lyndon b] 16/7/2020 21:51

That was a nice day at the (home) office $$$