System1 Share Discussion Threads

[nchanning] 16/4/2024 07:54

Forecasts again look set to be beaten next year . 8.7m revenue in Q4 and just 34.5 forecast for fy 2025 for a company that just grew 28% yoy .

[eliiwanier] 12/4/2024 16:13

Nothing to buy at the moment

[hydrus] 12/4/2024 11:13

Yes I agree. Looking forward to the trading update. The quarterly updates enables investors to model the likely annual outcome vs broker forecasts which is very helpful.

[cockerhoop] 11/4/2024 21:54

Hi Hydrus,

Yes, I've held on a couple of occasions but started the current position in July 2021 and added again in 2023 after the October trading statement when it was clear they were very likely to be upgrading forecasts with the Interims.

Whilst i'm far from an industry expert I like the data platform product and their general philosophy on advertising effectiveness and think James Gregory has added some business discipline that was probably lacking previously. Now the data platform is starting to get scale the operational gearing could be very strong here so I like the risk/reward.

[cockerhoop] 11/4/2024 09:38

Saying that I think the buying may be related to the probability of exceeding forecasts, any growth in Q424 over Q324 will provide the 5th consecutive upgrade.

[cockerhoop] 11/4/2024 09:32

Last year was I think untypical - I suspect the TU then was rushed out as a counter to the Stefan Barden led motion to oust the board - thankfully given the share price performance since then we dodged that bullet.

Only guessing but suspect this years update may be a little later in April.

[boonkoh] 11/4/2024 08:48

Suspicious big surge upwards just before a trading update?Last year it came out on 12th Apr....

[woozle1] 09/2/2024 15:57

Much easier to pick up stock. It feels likes there's a seller.

[nchanning] 08/2/2024 13:58

Perhaps investors seeing yesterday's Capital markets day . Management illustrating that a doubling in revenues would lead to a quadrupling in EBITDA to 17m which would roughly Translate into my 10m PBT . Guidance looks very beatable with just 7.7m forecast for this quarter despite doing 8m in Q3 with stellar growth . And for next year just 33m forecast despite 8m in last quarter and juggernauting momentum in the business . And we've already seen how beats in revenue lead to spectacular beats in profit with that sweet 87% gross margin ....

[boonkoh] 08/2/2024 13:54

Cannacord reiterates guidance today, and reiterates their target price. Lots of investors got excited and bought? Bizarre.

[nchanning] 24/1/2024 10:41

50m revenue , 10m PBT very reasonable 3 year target . 200m market cap

[z1co] 24/1/2024 09:20

And it's currently NT to buy even 100 shares at £3.40.

[nchanning] 24/1/2024 09:14

Over 50% upgrades to next years PBT numbers by Cannacord . High gross margins mean spectacular operating leverage . Revenue forecasts for next year look very beatable as well . Just 13 % growth predicted for a business that is currently growing way faster than that . Any extra revenue basically flows straight to the bottom line . Potential for earnings to go parabolic here

[saints98] 13/12/2023 15:40

Presenting on Investor Meet Company at 11.45am next week (Monday 18th)in case of interest

[nchanning] 13/12/2023 10:35

Just a small position for me as it's a fast moving industry where the business model could easily be upended . But close to 90% gross margins growing at 40% gives the potential for absolutely explosive growth . Shrinking consultancy is obscuring platform growth but not much left to shrink .

[eezymunny] 06/12/2023 12:32

If that were the case NChanning (bonuses etc) then you'd hope they have a bonus scheme for signing the next lot of customers i.e. it's not exceptional.

Really, with no justification from the company, this really is the most pathetic nonsense IMO. Shameful...

[nchanning] 06/12/2023 11:30

It seems very unusual , although I guess there's an argument for very sticky software companies that if there are bonuses for acquiring customers that won't be repeated the true steady state profitability of the business is being understated . Not sure this product is that sticky though ...

[cockerhoop] 06/12/2023 11:17

Even Canaccord suggest adjusted pbt is £1m rather than the £1.9m claimed. I presume it's as you suggest NChanning but surely it's not justifiable and creates the wrong impression regards the nature of the set of accounts.

[nchanning] 06/12/2023 11:06

Can anybody help me understand the managements arguments for adjusting out bonuses and commissions ? Is it that they are one off costs of acquiring customers that won't be repeated ?

[cockerhoop] 06/12/2023 09:34

I don't think the litigation settlement is £300k boonkoh. Other operating income was £330k rather than £224k so perhaps £100k.

Eezy - agree regards adjustments, especially bonuses & commissions - ludicrous.

[boonkoh] 06/12/2023 08:59

In fairness, they only state their statutory EPS and don't give an adj EPS number. But that statutory includes the £0.3m settlement from litigation! Which should be adjusted out too as its a one-off?Either way you slice it.... There's huge Operational Gearing here. They're well staffed up in terms of Sales & Marketing so all they need to do is knock on more doors, get more contracts signed.One potential red flag for me: no mention of churn rate or retention rate. If this was good, surely they'd shout about it?

[z1co] 06/12/2023 08:44

Agreed excellent H1 results and more to come in H2:

Gross profit margins has increased to 87.8%

The company won 136 new platform clients in H1 a massive increase over last year.

[boonkoh] 06/12/2023 08:36

Indeed, especially if you take their adjusted PBT. I'm inclined to take maybe half of the difference at face value. Would give an adj EPS closer to 8p.