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And I thought i'd got in at a decent price some time ago, now back to evens :-|
Thanks jimbren, busy day, I managed to miss it.
At first glance, it looks like a perfectly good update - the worst I can see is that the annual recurring revenue component, which they are trying to increase, hasn't much. They expect ARR to increase in the 2nd half. Otherwise it's all good - increases in sales, profit and cash held, and positive expectations as to the outlook. The problem is D4T4 was somewhat priced for fast growth, i.e. expensively. Not so much now!
H1 results today. No change from October trading update, but a somewhat underwhelming outlook statement given valuation? Still, lots of cash and enough +ve cash flow to fund a dividend. Patience required here.
... of 10% on no news I can discern. Market sentiment?
Not sure it was worth the wait but I think it is profit taking JDGL. D4t4 probably needs positive news flow to continue the upward trajectory and even then the valuation is a point of debate. They are still likely to need to transition a further 30%-40% of their business from licenses to SaaS and that is a material drag on near term revenue growth and margins. From these earnings and cashflow multiples the group needs to deliver multiple years of 20%+ profitability growth to look conventionally attractively rated (or one very very big year). The market opportunity and quality of the core technology are probably consistent with that objective, but as I started by saying the market probably needs re-afirmation in the form of a positive trading update/new order intake.
Nothing then? Bit quiet on this LSE board!
The underlying data in the RNS trading update seemed fairly healthy, only the BOD changes (and maybe change of focus) are of concern to me.
Thoughts regarding the 12% drop? Profit taking after steady rise or am I missing something else?