FCL is a stock we have had on our hitlist for some time for the Emerging Companies Portfolio and have watched it rally strongly since the company announced it had won a contract with Guardian Life. The company provides an ecosystem for insurance companies to handle customers, claims and billings also announced two major customers had migrated to their cloud-based platform which is likely to increase margins and longevity of contracts. The wins show that Fineos is gaining traction with the migration push, and helps support the company’s free cash flow (FCF) positive target for 2H FY24, now 6 months away.
With €25.5m in net cash at the end of the quarter, they are well positioned to move to profitability without requiring further capital. Overall, it’s been a strong few weeks for Fineos, and we expect the good news to continue when they report earnings on August 24th.
MM is bullish FCL ~$2.30
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