The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Nice.
Yaroslav, you posted the same question on ADVFN! Where I answered you as follows..... it's because Boku and Bango are Direct Carrier Billing providers in app stores etc where the take rate is very low, although on high transaction volumes.
As Finncap put it, "Fonix does not participate in this market", or in low value content in emerging markets.
Whereas FNX's own involvement is with high value brands outside of an app environment, and where it has very little competition.
What do people think in terms of timeframe for £2 target ... end of year ?
Hi guys, I have one misunderstanding about Fonix.
Total Payment Volume for Fonix is ~230m £ and the Company has Mobile paymnent revenue ~30m £. The close competitors Boku (6.9Bn £ End User Spend and ~56m £ in revenue) and Bango (1.9Bn £ End User Spend and ~12m £ in revenue) have significantly lower take rate (less than 1%) while Fonix take approximately 13% from its Operational volume. How does it happen?
Thank you for feedback
Key points which i took away were as follows:
Fonix is chasing rights owners in football (e.g
League, Sky Sports / Now TV); as well as rugby and Formula One, with the idea being that consumers enter a code on their smartphone / digital device to watch the match either beforehand or even 'in game'
NBA and NFL are also on the cards - the potential here is HUGE!
Funds already in - Slater, AXA, Blackrock, and Kestrel.
Fonix won 24 contracts in 2019, 27 in 2020 and now management expect to sign two on average per month.
There is SO MUCH more to the article but i won't put it here. All is very bullish.
The other thing which i can't help wonder is this - i recall from somewhere that Weisz had understated and overdelivered recently. I do wonder if he is doing this again with regards to the latest trading update. So couple this with the very bullish write up with TMI, the naked trader in on the act too, i do wonder if we will surpass finncaps
£2 rating.
That TMI write up got me on here....hope it delivers. Time will tell I guess.
Bug featuee and one of this months top tips. A most excellent, encouraging, and positive write up from the momentum investor.
Nice summary by Mark Watson-Mitchell:
https://masterinvestor.co.uk/equities/fonix-mobile-charging-to-your-mobile/?mc_cid=c0dc0f36ba&mc_eid=8bcbf5f078
"What do Cancer Research, Comic Relief, Children In Need, Sport Relief, The Big Night, Fishing TV, Global Media, Zing Flowers and The National Trust all have in common?
The answer is Fonix Mobile (LON:FNX). All the above utilise this group’s platforms to enable the user base of their supporters to seamlessly charge donation payments through to their mobile phone bills.
etc"
https://ukinvestormagazine.co.uk/more-to-come-from-fonix-media/
That's actually a very good broker note. Quite a good nunber of positive statements and words. I have bought in as from today, as it still looks cheap. Thank you Rivaldo for posting up the broker information.
For the record, here's Finncap's summary of their upgrade:
"Strong H1 trading update, target price upgraded to 200p
Following Fonix’s IPO in October 2020, today’s H1 trading update demonstrates continued growth that is comfortably in line with management’s expectations. Total Payment Volume (TPV) has grown +18% in H1 to £123m, as Fonix has successfully executed on its strategy to grow with both new and existing customers, including the BBC Children in Need campaign in November where Fonix’s platform handled £13.9m of the total £40.1m of donations.
Increased levels of customer activity have driven +21% growth in H1 gross profit to £5.8m,and Fonix is continuing to generate strong underlying cash flows that will amply cover the maiden interim dividend expected in March. We conservatively forecast FY21 gross profit growth of +13% to £11.2m, and H1 means that Fonix has already achieved 52% of our FY21 forecast.
As Fonix continues to deliver on the investment case that we explained in depth in November, we expect our conservative FY21 and FY22 forecasts of +11-12% EBITDA and EPS growth could seeupside, andeven on conservative forecasts, Fonix looks undervalued on 15x 12m forward EV/EBITDA and an EFCF yield of 5%. This compares to AIM payment and finnCap Tech 40 peers trading on 12m forward EV/EBITDA of 20-28x with 11-26% EBITDA growth, and EFCF yields of 2-3%. With today’s reassuring announcement we upgrade our target price to 200p (4% EFCF yield or 20x FY22 EV/EBITDA), and look forward to interim results in February."
Nice :o))
e
Great updat
Encouraging H1 trading update - everything "comfortably" in line.
In fact, with £5.8m gross profit in H1, FNX are trading nicely ahead of expectations. Forecasts are for £11.2m gross profit for the year, whereas FNX are on track for at least £11.6m even with no growth in H2.
Worth noting that the dividend is forecast to be 5.1p - a very healthy 3.5% yield:
Https://uk.advfn.com/stock-market/london/fonix-mobile-FNX/share-news/Fonix-Mobile-PLC-Trading-Update/84186480
Nice early move up - lots of buying coming in.
Looks like an overhang has been cleared judging by the trading at the end of last week.
https://www.investorschampion.com/channel/blog/an-exciting-new-fast-growing-arrival-on-aim
Just had a listen to Rob Weisz talking on the proactibe investors interview back in October. I was wondering what thoughts anybody has on his comment he made near the end of the interview regarding 'the tangible opportunities' which could 'blow the socks off'
Another insightful new article here about the IPO:
Https://www.icaew.com/technical/corporate-finance/capital-markets/how-fonix-mobile-completed-an-aim-ipo-during-the-global-pandemic
Extracts:
"How was Fonix able to deliver its IPO so smoothly? Well, it certainly helped that the company is relatively resilient to the impact of COVID-19."
"“We did sit down in April and think about how COVID-19 might affect us, but we haven’t needed to change the forecasts we made at the beginning of the year,” explains Weisz. “We think we offer investors a proposition that straddles different needs: we pay dividends, which is attractive to income seekers, but we also offer significant long-term growth prospects.”
"the company’s data room was so complete and well organised that while investors naturally wanted to challenge the management team, they were reassured by its quality of preparation. “The key in any IPO is to under-promise and then over-deliver,” he says. “If anything, the scepticism was around whether they had under-clubbed in their forecasts.”
Chris Searle, a corporate finance partner at BDO, the reporting accountants on the IPO, agrees that Fonix’s scrupulously thorough preparation for due diligence was a key factor in its speedy listing. “When we set out on the process, the timeline looked very challenging,” he says. “Fortunately, this was one of the best organised companies I’ve worked with in terms of the timely provision of information.”
“The aim wasn’t to achieve a valuation that would prove impossible to live up to, because this is just a stage on the business’s growth plan.”
(and CLX's too, which I also hold!). Some very nice quotes as below:
Https://www.lsegissuerservices.com/spark/three-ipo-stories
"We had rebuffed offers from trade buyers"
"We knew that we were going to have another really good year of growth so we decided to look at the IPO option"
"It did help that we didn’t have complex share or loan structures; this was a debt-free business where 94% was owned by seven people. We are a company that builds tech to service recurring and repeat revenue businesses. Investors liked that simplicity"
"We work with some very big players and by admitting to AIM, they have gained confidence to do even more business with us. They can see our shareholder register with investors such as Slater, JP Morgan, BlackRock and Axa"
Great to see the Naked Trader buying yesterday afternoon into FNX - here's what he said:
"An interesting play backed by a number of my best long-term students is Fonix Mobile (FNX)
The company says it provides mobile payments and messaging services for clients across media, telecoms, entertainment, enterprise and commerce. The Company offers an application programming interface for charging users directly to their phone bills through desktop, mobile and applications.
It's quite a recent market issue and even after some decent rises it does not seem especially expensive.
There seems to be some cash, and if profit forecasts are right it should be making some nice profits in the next two years and I wonder if it could pick up a rerating."
Don't say I didn't warn you! See below posts....
Rising again, and buying coming in now at above the published offer price (137.62p compared to the 137p offer price). Usually a very good sign.
Damian Cannon is a well-followed PI who has recently posted his 2020 portfolio review - in it he has a useful synopsis of FNX as follows:
"Fonix Mobile Bought at 126p - December 20
This is a very new addition to the stock market, listing in October. Ordinarily I steer clear of companies with a short public history but this piece by Martin Flitton piqued my interest due to the overlap in some of our holdings. Looking at Stockopedia, growth over the last few years has been very strong with profits rising 158% on an almost doubling of revenue. Margins are high, and rising, while the ROCE and FCF conversion numbers are both very high due to the capital-light business model.
In a nutshell Fonix is a mobile payments and messaging platform provider that allows consumers to make payments with their mobile phone. Fonix takes a commission from the end merchant and pays on a commission to the mobile operator; it's the difference between these two numbers that drives profits. Currently Fonix is UK focused with much of its revenue coming from the gaming and charity sectors. Future growth will come from taking carrier billing into new verticals and expanding internationally.
So far management don't appear to have put a foot wrong although I do need to go through the admission document to make sure that there's nothing nasty lurking in the fine print. If the prospectus is clean then analyst forecasts for 12% EPS growth in 2021 and 2022 look very undemanding (a point made in the Momentum Investor newsletter recently). I suspect that the broker is being cautious while there's so little information available which is why I've taken an initial position."
Very nice - a buy trade just now at 147p, way above the current 142p published offer price....
Overhang well and truly cleared! Up to 141.5p now....