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https://twitter.com/surprised_trade/status/1496512476736888836
added to holding.....Charles Stanley added to theirs, I've added to mine too, lol....broker with a current 230p target
According to ShareScope they were holding 3.7% at end Aug 21 but nevertheless this is a significant vote of confidence from CS. Annoying that TR-1s are so poorly completed... when they are completed at all...
FNX have a new major shareholder - Charles Stanley have been buying and are now above 5%, with 5.23m shares:
Https://uk.advfn.com/stock-market/london/fonix-mobile-FNX/share-news/Fonix-Mobile-PLC-Holdings-in-Company/87256875
Good to see Investors Champion are very keen in their AIM market update this morning:
Https://www.investorschampion.com/channel/blog/upgrades-in-the-aim-sell-off
"Fonix Mobile: upgrades
Mobile payments and messaging provider Fonix Mobile (AIM:FNX), which we covered previously in our premium report here: ‘Fast-growing arrival on AIM from 2020 is still looking good’ issued a positive update bringing an upgrade from its broker.
Gross profit and adjusted EBITDA for the 6 months to 31 December have grown ahead of management's expectations with gross profit up 20% to £7.0m with adjusted EBITDA similarly higher at £5.5m.
This business has a very attractive cash flow model, as our note highlights, and with continuing strong cash generation, Fonix now intends to pay an increased interim dividend in March 2022.
Total payment volume of mobile payments grew by 12% to £138m with 116 (H1 FY21: 105) active customers at the period end.
Fonix remains the leading provider of charity telethons, including ITV's Soccer Aid, BBC Children in Need, Comic Relief and The Ruth Strauss Foundation, and has added several new clients in the period.
In response to the latest update the Group’s house broker upgraded their June 2022 and June 2023 adjusted EBITDA by +5% to £10.1m and £11.1m – given recent performance those still far too low to us. Their target price has been upgraded to 230p from 200p, well above the current 160p share price.
We aren’t big fans of the fairy tale ‘adjusted EBITDA’ measure and prefer to focus on free cash flow. In the case of Fonix this is even more compelling with the forecast free cash flow yield for 2022 a highly attractive 4.6%.
Its resilient business model should appeal to investors worried about current events."
and also raise their forecasts to 7.9p EPS to June this year and 8.8p EPS next year, with 6p and 6.6p dividends on top.
Finncap say those upgrades are "conservative". Certainly FNX are rather undervalued against their peers given the relatively low P/E and the very high dividend yield of around 4%.
I like FNX's extremely understated methods. They seem to like to underpromise and then overdeliver, even though they have a number of avenues for growth.
Finncap conclude:
"Fonix’s robust investment case –
As we explain in more depth in our 23 September report, Fonix is focused upon leveraging its highly scalable, cloud-based platform to expand with existing clients and win new clients as mobile commerce and mobile payments continue to scale. The structural strength of its platform is demonstrated by it experiencing no churn from major customers in six years, and it is diligently expanding its market-leading technology outside of the UK when it is led by its existing clients.
The successful execution of its strategy has driven Total Payment Volume (TPV) to £233m in FY21 from £125m in FY18, adjusted EBITDA to £8.8m in FY21 from £3.3m in FY18, and underlying EFCF to £7.3m in FY21, as management explained in more depth at the FY21 results. We conservatively forecast adjusted EBITDA growth of +15% and +10% in FY22 and FY23, and we expect that any upside to our forecasts will be returned to shareholders through Fonix’s dividend payout ratio of 75% of adjusted EPS."
Customers grew less than I wanted but (was wanting 15%+) but that gross margin is WAY better than before which more than makes up for it.
If H2 matches then gross profit will be £14m for 2022 FY. 2021 was £11.35m
Which is better than I had expected. Wonder why clients are specifically higher margins that they are targeting, anyone know?
It's only halfway through the year, yet FNX are already able to say that trading for the year to 30th June will be "comfortably ahead" of expectations. That's pretty bullish stuff.
In particular, the number of customers is up 10%. All segments of the business are growing.
And to conclude:
"Outlook:
With high levels of repeating revenue and client retention, expanding international reach, and a growing pipeline of client prospects across all sectors, the Board continues to be confident in the growth potential for Fonix going into H2 FY22 and beyond."
Thx Surprised, good to see the brokers have upgraded to a 230p price target.
https://twitter.com/surprised_trade/status/1485876547521286148
rns - ahead of expectations -Gross profit in the period grew by 20% to £7.0m
Adjusted EBITDA1 grew by 20% to £5.5m
Fnx generates strong underlying cash flows and intends to pay an increased interim dividend
Broker upgrade target 230p
New blog post from FNX - a couple of extracts:
Https://blog.fonix.com/could-2022-be-our-most-exciting-year-yet-248d56c9189a
"Could 2022 be our most exciting year yet?
Hannah Giles
Jan 11
Pay now, pay later, pay in installments, pay by mobile. Today, it’s never been quicker and simpler for consumers to spend money. The payments industry is being shaped by the demand for choice, value and flexibility. People have embraced, and now expect, payment methods that deliver great value, function instantly and make their lives easier.
Digital wallets have revolutionised the financial services industry by providing instant and convenient payment to consumers, enabling everyone, banked or unbanked to use these services. According to Juniper Research, there were 2.6 billion unique digital wallet users globally in 2020, which will increase to 4.4 billion by 2025. With consumer trends moving towards totally electronic wallets, the digitisation of payment methods is now part and parcel of keeping up with consumer demand....
....The appeal to pay by carrier billing is rooted in a consumer desire for convenience and frictionless experience; whether it’s buying a ticket, watching live sport or donating to their favourite charity, consumers want things immediately sorted.
We’re extremely excited to see the next phase of digital payments as alternative payment methods become the norm — watch this space!"
https://twitter.com/surprised_trade/status/1479382709524910081
Finncap broker note with 200p target on 18.11.21
''As Fonix continues to deliver upon the investment case that we explain in depth in our 23 September report, we look forward to H1 22 results in February, launches into new geographies, and the announcement of new contract wins. We reiterate our target price of 200p ''
https://twitter.com/surprised_trade/status/1479375414418100225
new hold..
Topped up here at prices I didn't expect to see again.
Nice review on Investors Champion:
Https://www.investorschampion.com/channel/blog/valuations-of-some-look-stretched
Fonix: good value
Fonix (AIM:FNX), the mobile payments and messaging provider, confirmed it had made had a positive start to the financial year, in line with management expectations, with highlights including new partnership agreements signed with Venntro Media Group and a global payments platform provider. The partnership with Venntro will see the roll-out of carrier billing into Venntro's 2,500+ white labelled dating sites.
You can read our earlier premium coverage here: ‘Fast-growing arrival on AIM from 2020 is still looking good.’
In September, Fonix mobile payments made a significant contribution to the £13m in charitable donations raised for ITV's Soccer Aid. This followed £0.5m in mobile donations raised for The Ruth Strauss Foundation in August. Fonix will also be powering donations for BBC Children In Need for the eighth consecutive year.
This is a lovely little business delivering growing profits and plenty of cash, supporting a nice 3.5% dividend yield. Trading at c20x forecast earnings for the year ending June 2022 (growth 10%), and delivering 150% return on capital, the shares look decent value compared with technology peers.
Finncap have reiterated their 200p target price.
They note that their forecasts are conservative given the expansion into (1) new verticals and (2) new geographies.
today. I particularly like the closing paragraph:
"With high levels of repeating revenue, significant new platform partnerships, new supplier connections in international markets and a growing pipeline of client prospects across all sectors, the Board continues to be confident in the growth potential for Fonix for the rest of the financial year and beyond".
Https://uk.advfn.com/stock-market/london/fonix-mobile-FNX/share-news/Fonix-Mobile-PLC-AGM-Statement/86594384
Investors might miss in today's bland-sounding RNS about the Notice of AGM (for 18th November) that it also sneaks in a rather encouraging single line confirming trading remains nicely in line with expectations.
Hopefully the AGM RNS will have a further update.
Go back to July low and since then is that a H&S I see? Does it quack?
Ramptastic. Someone wants you to buy this. Be careful.
Research Tree posted on Friday a 45 minute results presentation from FNX, including questions at the end. It's well worth a watch for subscribers - I can't see it anywhere else yet, be it on FNX's web site or anywhere else on the web.
Interesting comments about international expansion:
- FNX are currently looking at international opportunities in:
Gaming
Media
Charity
E-mobility (e-scooters)
- revenue opportunities will as usual last 2-5 years plus plus
- the Austrian opportunity has only taken six weeks to fulfil, with no additional resources necessary, since existing staff were able to implement it
News of a dating services partnership with Venntro on 2,500 web sites - note the mention of international expansion:
Https://blog.fonix.com/fonix-partners-with-venntro-media-group-a-global-leading-provider-of-dating-platforms-d8668a20a25a
"Fonix partners with Venntro Media Group, a global leading provider of dating platforms
Sep 23
We’re excited to announce that we’ve partnered with Venntro to enable users to conveniently subscribe to dating services.
Venntro is the global platform of choice for media brands and online marketers to deliver fully-branded online dating sites.
The partnership will see the roll-out of carrier billing into the 2,500+ white labelled dating sites that Venntro supports giving consumers who use the services more choice, flexibility and convenience when either paying for the subscription or any one time purchase option across the platform.
A registered user opting to pay via carrier billing will be automatically and securely identified, enabling them to complete their purchase with a simple and seamless 2 step payment experience, without having to enter any further information.
The roll out of carrier billing started in August; so far Venntro and its partners have seen a huge +28% growth in new same-day subscribers — users that upgrade on the day they join a dating site.
We’re thrilled to be working with Venntro; it’s great to showcase the exciting work that we’ve been doing behind the scenes to ensure that the technical integration and user experience will deliver real value to the product and Venntro’s client base.
There’s lots of promising opportunities ahead, not least with expanding payment options but also looking at supporting Venntro internationally."
I finally managed to read through the new 31 page note from Finncap, and thought the following extract was a nice insight into FNX's growth path for the current year:
"In FY21, Fonix has maintained its 100% client retention rate and grown its active client base to 111 from 98 at FY20 and 105 at H1 21. It has continued to demonstrate strong traction in both existing and emerging sectors such as mobility, ticketing, and dating, where it recently launched services with a multinational tech company operating thousands of online dating sites globally.
In FY22, Fonix’s client additions could further accelerate following the doubling of its sales team in early FY22 through the addition of 2 new employees, and a new partnership with a leading technology provider that could open up a considerable pipeline of opportunities in the UK and international markets.
Fonix established connectivity for its first international operation in Austria in FY21, where it could harness the deep understanding of the regulatory framework of one of its gaming customers. We expect that its launch will provide a template for Fonix’s client-led expansion into new markets, with Fonix in advanced discussions to launch services with a key customer in an additional European market, and several of its other multinational clients looking to expand Fonix’s services overseas."
If you look at the interims the gross profit was up by 22% whereas in the finals gross profit was up by 13% .
Thus, although finals were good, the fast money was hoping for something more like the interims.
It's true the finals were in line with broker expectations and trading update, but the fast money was still hoping for a little bit more.
On top of that markets are more negative now with correction fears, inflation fears, gas supply fears etc etc
All IMO.
Why did the sp drop yesterday after excellent results? Was Mr Market expecting even more (a not unusual phenomenon)?
Finncap retain their 200p target price.
They say their forecast of 7.6p EPS for this year (with a 5.7p dividend) is "conservative", and they introduce 8.3p EPS forecast for next year (with a 6.3p dividend).
Their note is 31 pages long so very comprehensive!
The 7p adjusted EPS is slightly above Finncap's 6.9p forecast, and with 7.6p EPS forecast this year, plus a £5m and growing cash pile (up 158%), FNX are trading at far below the multiples achieved by its sector peers.
Plus of course FNX pay a very healthy dividend - today's 3.5p makes a total 5.2p dividend for the year.
The outlook is very confident, with current year trading described as having started "very strongly".
There's international expansion to look forward to being announced soon, and today we learn of new contracts recently signed with large gaming and dating companies. Other companies would surely have splashed these all over RNS's etc. This is perhaps indicative of FNX's prudent style, though I see no reason why they couldn't have highlighted them on their web site.
There's also an interesting hint to close on:
"We recognise that by delivering on these objectives and potentially winning some flagship clients from our competitors we have a great opportunity to exceed expectations."