Genusplus (GNP) Outlook
Hi Team Interested if you have an updated view on GNP? The financials look pretty solid and forward PE looks good also. Wondering if would consider it a buy at these levels? Thanks Alex
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Answer
Hi Alex.
Genusplus (GNP) was a new stock to us before they presented at the Bell Potter Emerging Leaders conference last month, and it is an interesting business, a small Worley (WOR) would be the best way to describe it, covering design and engineering to commissioning, maintenance and decommissioning of power & communications infrastructure.
Clearly, they are in a good spot and positioned well to benefit from the rise of renewable power which is coming albeit in a hard to predict manner.
It is capped at $330mn with the share price almost doubling in 2024 – so optimism is priced in. The only aspect we’d flag here is around the cost and utilisation of people – its hard to keep good people and the cost of the energy transition will drive up wages in this space. People are key to this business and as a client who ran a large business in this space often reminds us, you either have too many or too few! That said, the financials of GNP do indeed look solid with the company even forecast to pay a small yield over the next 12-months.
- From a risk/reward perspective the stock looks good into dips ~$1.75, and is now in our universe for the Emerging Companies Portfolio.
