Tesserent is a ~$200m cyber security business that works with both government and private enterprise, that should in theory be killing it in this current environment. We actually answered a question on it recently which prompted todays spiel. We spoke to the company soon after they released their solid 1H results and I was impressed with how management presented. They have a number of Government contracts that provide a solid, long term base to revenue and management noted the ability to pass on price increases across these deals. Their commercial business has seen margins rise, but employment costs are also on the move given the specific skills Tesserent need. They are cashflow positive and will be targeting new acquisitions which should help them grow earnings over time. We like the exposure to an ‘in demand’ space and this is one we will keep on our Hit List for now, we would prefer to wait and see them execute on their growth strategies before gaining greater conviction in the story.
MM has TNT on our Hit List
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