We have held Audinate (AD8) in the portfolio in the past, unfortunately selling it last year on concern around falling margins – it has rallied since as the audio systems business now looks to be one of the big winners in the post pandemic recovery. Revenue held up well at the FY21 result with top line growth of 20%. The key for Audinate is the moat it has built against its competitors, now with Dante hardware in more than 3,200 products, its 19x bigger than its nearest competitor. Margins will improve with further adoption of their software while revenue is expected to grow over 25% from FY22 and beyond. The issue is, it’s not cheap, on around 17x forward sales it’s up there with the likes of Xero (XRO).
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Performance update for March, stocks that drove returns & our current positioning
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Wednesday 24th April – ASX200 +17pts, Silver Lake (SLR), Kogan (KGN) & CPI
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Market Matters Research Lead Shawn Hickman with David Koch
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Wednesday 24th April – DOW +263pts, SPI +27pts
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MM is neutral AD8 – for now
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