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I’ve doubled up here to ensure some of these gains are tax protected. Could have a long way to go.
Certainly looking strong again - bouncing nicely on any dips and now up a further 6p to 85p.
With 13.7p EPS forecast this year, INSE still looks exceptionally good value against Liberum's 200p target price.
Excellent start - up another 3.5p, and almost moving up on every buy, perhaps suggesting not much stock around.
Crikey, even INSE's joining in today's small cap rally....about time. Loads of upside here for a fair valuation imo.
As a reminder, Liberum recently issued a new 36 page Buy note, with a 200p price target....
Here's their summary:
"Inspired Plc
The transition to a more diversified business is on track
The FY 23 results were slightly ahead of our estimates. We make four key points on the business: 1) Inspired has evolved from a Third-Party Intermediary (TPI) in the energy market to a technology-enabled services provider; 2) synergies between divisions help cross-selling and make Inspired uniquely qualified to help with both sides of the energy equation (cost + consumption); 3) underlying EBITDA is expected to double in five years (FY 22-27), indicating 24% upside to our FY 26 estimate; 4) the business is becoming less reliant on Energy Assurance profits, which helps increase earnings quality. In terms of valuation, a CY 24 P/E of 4.6x is attractive given the growth.
Key points
FY 23 results were slightly ahead.
Optimisation was the star performer.
Net debt (exc. leases) was flat at the H1 23 level of £49m.
Contingent consideration being paid.
Value drivers
Scope to grow in areas like Optimisation, Software and ESG.
These should accelerate growth and increase the valuation multiple.
A huge addressable market.
inspired chief executive officer, mark dickinson, chief commercial officer, david ****shott and cfo, paul connor present final results for the year ended 31 december 2023.
watch the video here: https://www.piworld.co.uk/company-videos/inspired-inse-full-year-2023-results-presentation-march-2024/
or listen to the podcast here: https://piworld.podbean.com/e/inspired-inse-full-year-2023-results-presentation-march-2024/
Liberum have issued a new 36 page Buy note this morning, with a 200p price target....
Here's their summary:
"Inspired Plc
The transition to a more diversified business is on track
The FY 23 results were slightly ahead of our estimates. We make four key points on the business: 1) Inspired has evolved from a Third-Party Intermediary (TPI) in the energy market to a technology-enabled services provider; 2) synergies between divisions help cross-selling and make Inspired uniquely qualified to help with both sides of the energy equation (cost + consumption); 3) underlying EBITDA is expected to double in five years (FY 22-27), indicating 24% upside to our FY 26 estimate; 4) the business is becoming less reliant on Energy Assurance profits, which helps increase earnings quality. In terms of valuation, a CY 24 P/E of 4.6x is attractive given the growth.
Key points
FY 23 results were slightly ahead.
Optimisation was the star performer.
Net debt (exc. leases) was flat at the H1 23 level of £49m.
Contingent consideration being paid.
Value drivers
Scope to grow in areas like Optimisation, Software and ESG.
These should accelerate growth and increase the valuation multiple.
A huge addressable market.
What market misses
Assurance
On excellent early volumes. Hopefully just the start of a big bounce for this seriously undervalued (imo) company.
Liberum say Buy and have a 200p target price. They summarise:
"A revised CY 24 P/E of 4.6x is attractive given the growth A CY 24 P/E of 4.6x is attractive given the growth. Inspired has a low carbon beta, but that should change as its ESG credentials become more apparent. Growth in newer areas like Optimisation, Software and ESG, should accelerate growth and drive a re-rating. Our SoTP suggests a TP of 200p."
And:
"FY 23 underlying EBITDA increased 20% to £25.2m and FD EPS was 3% ahead of estimates. Net debt was flat at the H1 level of £49m and cash conversion was below target as expected, but LTM conversion to February was > 100%.
We maintain our FY 24 FD EPS estimate of 13.7p, indicating 3% FD EPS growth. We make 4 key points: 1) Deferred consideration will fall sharply after FY 24; 2) A wealth of new KPIs shows cross-sell is working and increasing the life-time value; 3) Assurance has good visibility and is stable; and 4) At Energy Optimisation, EBITDA has increased £5m p.a. over the last three years. A CY 24 P/E of 4.6x is attractive given the growth."
Mark Dickinson, CEO gives an overview of the year ended 31 December 2023 and a strategy update on the organic growth path to double EBITDA by 2027.
Watch the video here: https://www.piworld.co.uk/company-videos/inspired-inse-full-year-2023-overview-march-2024/
Or listen to the podcast here: https://piworld.podbean.com/e/inspired-inse-full-year-2023-overview-march-2024/
Good, solid results today are actually slightly ahead of those flagged in the trading update, with £25.2m EBITDA (against the £25m in the update). The adjusted EPS is 13.4p, so a P/E of just 4.7.
The divi is up 7% to a tasty 2.9p, a 4.6 yield.
Cash generation from operations is healthy at £18.7m and has improved greatly in this Q1 with the unwinding of working capital.
Of course some won't like the net debt increase and huge adjustments to get to the statutory figures. But this is primarily down to the additional consideration due on acquisitions which have paid off hugely (see the CFO's statement).
Most importantly, the outlook is extremely confident:
"Current trading and outlook
The secular demand from companies to reduce energy consumption, drive efficiencies and report against progress remains unchanged and underpins demand for the Group's services.
FY24 has started strongly, with the Group trading in line with expectations and with substantial cash generation as the working capital investment in Q4 2023 unwound.
The growing demand, and demonstrable success, of selling into new and existing customers, underpins the Board's confidence in the outlook for FY24."
Strategic Equity Capital plc, who have a £7.32m investment in INSE, note in their interims today that a the shares fell "despite strong current trading and limited newsflow".
They summarise as follows:
"Inspired Energy
Investment Thesis
UK B2B corporate energy services and procurement specialist with strong ESG credentials
Leading player in a fragmented industry; significant opportunity to gain market share through client wins, proposition extension and M&A
Valued at a substantial discount to comparable private market transaction multiples
Developments
High energy costs have driven accelerated growth in optimisation services
ESG revenues accelerating from a low base"
INSE will announce their results on 26th March:
Https://uk.advfn.com/stock-market/london/inspired-INSE/share-news/Inspired-PLC-Notice-of-Analyst-and-Investor-Presentations/93450474
As a reminder, Liberum forecast £16.2m PBT for last year, rising to £18.3m PBT this year.
That equates to 13p EPS rising to 13.7p EPS this year - a P/E of just 5.2.
Liberum also forecast a 2.7p dividend for last year, rising to 2.9p this year (a 4.3% yield).
Feels like it’s getting ready to make some gains. Time is right, volume been on the up lately.
INSE recently held a webinar with over 400 people attending, mainly focusing on a number of net zero and ESG topics as outlined in the article:
Https://inspiredplc.co.uk/insights/industry-news/impact/eyes-on-the-horizon-what-did-our-first-2024-webinar-foresee/
Good to see a little buying coming in at the full 69p offer this morning.
Liberum forecast £16.2m PBT for last year, rising to £18.3m PBT this year. That equates to 13p EPS rising to 13.7p EPS this year - a P/E of just 4.9.
Liberum also forecast a 2.7p dividend for last year, rising to 2.9p this year (a 4.3% yield).
The dark and murky world of trades in Insewincey. Looks like a series of buying but the shares still manage to go down . If todays trades were actually sells then the so would be back to old price of about 5p. Managed to get an offer of 63p for the remains of my holdings. This is just the most dodgy stock on the market.
Unfortunately a company that keeps taking from investors to reward the directors. So typical of dross segment of Aim
Good to see all buying this morning after the positive trading update (one 10k trade marked as a sell is undoubtedly a buy), and the price moving up 2.5p on a modest £40k or so of volumes which suggests not much stock around.
Liberum have retained their Buy and 200p price target.
They conclude:
"A CY 24 P/E of 5.4x is attractive given the growth. Inspired has a low carbon beta, but that should change as its ESG credentials become more apparent. Growth in newer areas like Optimisation, Software and ESG, should accelerate growth and drive a re-rating. Our SoTP suggests a TP of 200p."
They also see a nice comparison with the recent sale of eEnergy:
"The eEnergy disposal supports our valuation of the Assurance division
We see the sale of Energy management by eEnergy, earlier in January, as relevant to Inspired. eEnergy’s FY 22 R&A says that its ‘Revenue is comprised of fees received from customers or commissions received from energy suppliers, net of value-added tax, for the review, analysis and negotiation of gas and electricity contracts on behalf of clients in the UK.’ It is therefore comparable to Inspired’s Energy Assurance business, which we view as Inspired’s lowest rated business, given its lower growth. The adjusted consideration appears to have been £30m or £40m including max consideration of £10m, and the FY23 adj EBITDA for that division was £4.4m, which suggests a trailing EV/EBITDA of 6.8x to 9.1x, which is consistent with our SoTP valuation of 8.0x."
INSE is at last rediscovering its mojo.
Nicely in line with Liberum's forecasts at £25m EBITDA and likely £16.2m PBT, which implies around 13p EPS.
That's a historic P/E of only 5.6.
Net debt should come down sharp-ish from here and is also in line with expectations taking the January inflows into account.
Revenues are actually below forecast, which makes INSE's performance even better as margins are rising and product mix improving, so with continued revenue gains then profits should climb fast.
Above all, the business seems to be thriving and the outlook is confident. Optimisation is striding ahead up 13%, ESG is now EBITDA-profitable and growing revenues annually at 100%, and Software is also growing nicely at 15% with high margins.
The outlook is very strong:
"The Group started Q1 2024 strongly with substantial cash generation as the working capital investment in Q4 2023 unwound and is confident in the outlook for FY24.
This momentum is expected to continue, giving the Board confidence in its previously stated aspiration to maintain double-digit organic growth and, by FY27, double Adjusted EBITDA organically from that achieved in FY22. The associated cash generation will also lead to a deleveraging of the Group in relative and absolute terms."
HNY to all holders here.
Nice start to 2024 - up over 30% in the last 3 weeks, and moving up nicely once more today on relatively small buying, so hopefully not much stock around.
Hopefully lots more upside from here as the outlook remains extremely promising and the fundamentals good value with the concentration on reducing debt via the excellent cash flows.
O good someone bought 1 share . Bit rash
As expected more dilution to new lows for this lamentable shower
Laughable and disgraceful. More awards for this pitiful performance. Should knock another 10 percent off the share price on 23rd.