Sectors: Technology
We are looking at a simple switch in-line with our recent rhetoric towards equities:
Once a market darling with huge prospects for growth in the US Buy Now Pay Later (BNPL) space, Zip has now fallen to near 2 year lows with a disappointing update this week causing the latest round of selling. The update came out of cycle, ahead of their scheduled half year report tomorrow which will now likely be more focussed on their potential takeover of rival…
Tomorrow will see APX report its sins to the market, expectations are certainly on the low side, hopefully (not a great word to use as an investor) we will see a carbon copy of a2 Milk (A2M) which rallied strongly after delivering no hidden nasty surprises. However if we don’t like what we read subscribers should be prepared for us to cut the holding and reallocate into Xero (XRO) as it trades around ~$100 and we look for a decent recovery by tech names.
WSP -5.5%: the cloud communications business posted a strong 1H22 result this morning however the stock was weighed on by weakness across the small ords. Revenue jumped 70%, helped by a strong transactional performance. This did weigh on margins though, but EBITDA was still ahead of expectations at a loss of $3.7m. They noted a ramp up in average reoccurring revenue…
XRO has already fallen over 37% on valuation concerns which have rolled through the whole sector however we like the online accountancy stock under $100 and we are considering increasing our position.
We believe MSFT is a world class company that’s been caught up in the current mentality of if in doubt sell tech but at MM we believe solid value is presenting itself into current weakness.
Z1P –7.78%: released a (surprise) interim half year update today ahead of the full report later this week. While customer numbers (9.9m) and revenue ($302.2m) were records, so too was the cash EBTDA loss of $108.1m, well above the ~$40m expected by the market. The bigger than expected loss was a result of heavy investment in international markets, and while it’s generating growth, the increased…
TYR -25.92%: a very weak first half result today saw significant pressure put on shares in the payments solutions business today. Tyro saw transaction volume and revenue jump around 30% each, but EBITDA fell 67% to $2.8m on higher costs. There was a significant jump in merchant numbers but transactions were weighed on by extended lockdowns in NSW and Victoria. Costs were also…
ALU -5.92%: A weak session today for Altium despite upgrading their revenue guidance for FY22 with the stock down ~10% at the worst before recovering to close down a more modest 6%. The issue came around margins which has been a common theme for tech stocks this reporting period. 1H22 revenue came in at $102.2m inline with expectations while FY22…
EML -3.97%: a choppy ride for the payment solutions business today on the back of a mixed 1st half result. Revenue of $113m was a slight miss, EBITDA fell 4% to $26.9m but they maintained full year guidance of $58-65m in EBITDA which will require a big second half to reach. The positive news is that the sales pipeline is growing, up 30% in the half to $13.6b and they…
