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With results to be announced on 3rd April this should be significantly higher in 5 weeks time, there will be a few profit takers from Friday's dip but once they are cleared I can't imagine who would want to sell down here when they were trading at £7 as recently as 6 months ago... It also wouldn't surprise me if we got another acquisition between now and the results as 2022 saw Iolap in March & 2021 retearn.
It is very cheap for the growth finn cap 959p target price
Hugely undervalued and 2.5% divided yield.
FinnCap-
'Elixirr continues to gain market share in a very large end market and, reflecting
the continued growth potential, we have upgraded our FY 2024E EPS by +9%. Elixirr has evidenced
it is not seeing the slowdown others in the wider consulting market have described that has
recently impacted its share price materially, providing a significant value opportunity.'
Fantastic update, 2023 guidance increased vs market expectations and excellent 2022 performance.
Assuming they maintain a 29% EBITDA margin and hit the mid point of current estimates (£86m) they’ll deliver £25m EBITDA for 2023. At 10x EV - EBITDA this would put them on a share price of £6. With mature, slower growing peers like Accenture trading at ~16x EV this would still be cheap…
Well they provided a nice set today which should steady nerves.
Probably, the current and forward looking statement is key-
'FY23 revenue expected to be £85-87m, with Q1 currently trading ahead of this and a record revenue month in January 2023. Growth trajectory expected to continue into FY24'
Also 'proposed final dividend for FY22 of 10.8p per share, an increase of 160%' will do no harm.
GL.
Sold out a few weeks ago at 520p.
It takes two to tango.
I had gone to the conclusion that peeps would not be willing to pay a premium for high growth. Therefore, minimal upside.
Not going to rain on the parade anymore.
Long term wise - ELIX is a winner. Short term wise - I do not know.
today's knee jerk reaction is a buying opportunity imo
Added at £4.20, a 15% fall on nothing of any substance creates a good top up opportunity IMO. Enterprise value is now ~£170m vs an expected EBITDA of £20m, so 8.5x EV/EBITDA.
Things can always get cheaper in the short term but this is now trading at a lower valuation than the July 2020 IPO so looks interesting. Let's see what happens...
I got this one wrong! The fall looks to be in response to the Kin & Carta update flagging a slowdown in the sector coupled with McKinsey saying that they are making 2k redundant.
I know someone in another firm in this space and they have been expanding and are still very busy, however a full year update with an outlook statement from Elix is needed.
So I see last years update was a Tuesday. Do we think that it will be 14th Feb for ELIX?
I'm in. The H1's looked solid but the price dropped after, director buys since the fall. I like the growth story although organic growth does seem rather dependent up promoting enough Principles up to Partners. My main reservation is that for a business based on its staff the reviews in Glassdoor are not exactly the best for companies in the sector.
Already doubled my position compared to last year. Bit by bit each month. I'll be happy if it stays this low for a few months longer.
Today's US payroll figures confirm the strength of the US economy where ELIX has c44% of their biz. Bodes well for 2023 year.
Famous last words - I reckon the results are going to be pretty stellar. Why?
- CEO has tons of shares - he has plenty of skin in the game
- order book MUST be known in advance in respect of projects going forward (at least 6-12 months) - to ensure planning of staff. Expectations must have been set based on these.
- management consultancy is set to grow in 2023 - I reckon peeps think it might retract but even in a recession - companies are going digital / spending on digitalisation / restructuring etc.
- very strong H1 so H2 expectations should not be strenuous to achieve.
- last investor presentation @ 8/12/20 - management appeared relatively confident reiterating current year expectations (so this was 23 days before the year end). Of course, they can not disclose new info - but my reading was that it was pretty positive.
- NED bought shed loads of shares in Nov 23 - before the "closed period" at similar sp.
- they might be eyed up by one of the big boys for a potential TO - would not surprise me.
PE ratio is up there but take a butchers at their CAGR + profitability and tell me that they don't justify a high valuation.
Results out imminently.
https://www.mca.org.uk/press-releases/strong-growth-in-management-consulting-expected-in-2023-according-to-biggest-uk-survey#:~:text=The%20latest%20Member%20Survey%20from,of%20economic%20uncertainty%20and%20change.
Volume of buys up today. Peeps getting ready for the pending TU in 2 weeks time?
lagging the ytd rally for no reasons. Peers are smashing it so will ELIX. STRONG BUY
Very good investor meets company presentation earlier this week, well worth watching, especially the last 15 minutes from the CFO. I thought the most interesting bit was about their 'programmatic' M&A strategy where they are aiming to execute 1-2 deals per year for a total value of 20-30% of market cap. This makes complete sense to me & means a material addition to annual EPS + a material portion of the consideration being share based not wasting management time integrating a minimally accretive deal. This is all funded via a mix of FCF and earn out shares, and the CFO was clear that he believes no consultancy should ever be in debt (something that I'm sure TPX wish they'd followed).
It means we can assume that they are looking at deploying £45-70m on their one to two 2023 deals, this would be funded by the ~£20m cash on hand + ~£15m in 2023 FCF + the rest in share based earn outs. Given the current environment they should be able to negotiate some good terms, (better than iOLAP), but it's impossible to say how much these deals will add to EPS. Even assuming 10p per annum (~£5m incremental PAT) it's easy to see FY24 EPS reaching 50p+, versus the current 33p forecast. Simple multiple expansion on 17x would see ELIX trade at 850p, however given this was trading at 20-25x for most of this year you'd have think a share price in excess of £10 would be readily attainable if they execute well.
Beyond FY24, where will this be trading in 5-7 years if they continue such a strategy? The CEO emphasised they want to emulate Accenture so the ambition is huge and they've arguably done the hardest part in reaching significant FCF generation with no debt. I've added an initial position today and will increase further if this does fall back, however I'd be surprised if it goes much lower given the fundamentals + quality management.
Greatly underappreciated share in my opinion so I keep topping up each month. At the current price forward P/E is somewhere below 20 if I'm right.
Hasn't been that cheap for ages or ever.
STRONG BUY - strong growth across the board (revevenue, EBITDA, net income) just CFO came is softer but still positive. Outlook remains very appealing and at this valuation level it's a STRONG BUY !!
A trading update?
What kind of good news are you thinking ?
Soon