finnCap Research Company Notes - 27 February 2020

Feb 27, 2020 / News

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Sector: Life Sciences

ANGLE (AGL) : Corp

Third-party research – this time in kidney cancer

Key data                              

  • Share price (p)                  62.0
  • Target price (p)                135.0
  • Market cap (£m)                              107.1
  • Enterprise value (£m)                    86.7

Another independent piece of research, this time from the Istituto Nazionale Tumori di Milano, Milano, Italy and published in the International Journal of Molecular Sciences, demonstrates the potential capability and advantages of Parsortix over other CTC systems in Renal Cell Carcinoma (RCC – kidney cancer). The Parsortix system was combined with a single cell picking system so that individual CTCs could for the first time, in this tumour type, be harvested and then analysed to assess the heterogeneity of the CTCs. We view this very positively. This represents the 29th peer-reviewed independent research using Parsortix. However, the near-term focus remains the potential for FDA clearance of Parsortix in late 2020, which will be a watershed moment for further clinical applications to be developed. No changes to forecasts and we reiterate our target price of 135p.

Mark Brewer

020 7220 0556

mbrewer@finncap.com

 

Sector: Technology & Telecoms

Amino Technologies (AMO) : Corp

Execution proves strategy

Key data                              

  • Share price (p)                  134.0
  • Target price (p)                215.0
  • Market cap (£m)                              101.9
  • Enterprise value (£m)                    100.9

Finals for November FY19 report performance demonstrating execution of both the transformation programme announced this time last year, and the integration of the July acquisition of 24i Media. The focus on higher-margin software-enabled devices and the growth of both recurring revenue and software as a % of group revenue improves margins, visibility, and earnings quality, while returning forecasts to prospective growth. Typically strong cash generation and positive KPIs drive home the point that financial execution is on track or slightly ahead of expectations (from revenue outperformance and mild consequent revenue upgrade); while operational execution is also laudable with the joint Amino/24i contract win with Dutch MVNO Youfone, increased international diversification, and a consistent pace of R&D to satisfy and exceed client and end user requirements. A successful set of results prove the bullet was bitten bravely and justifiably, and we look forward to further contract wins. Target 215p reiterated, with forecasts benefitting from upgraded revenue (+4% FY20; +3% FY21) accommodating greater opex investment and unchanged EBITDA expectations.

Andrew Darley

020 7220 0547

adarley@finncap.com

 

Sector: Technology & Telecoms

Netcall (NET) : Corp

Interims on track as ACV builds visibility and growth

Key data                              

  • Share price (p)                  37.0
  • Target price (p)                90.0
  • Market cap (£m)                              53.1
  • Enterprise value (£m)                    53.3

As revealed at the January trading update, interims to December 2019 have delivered £2.1m EBITDA from revenue of £12.3m, representing 48% of full-year targets with period-end net cash/ debt of breakeven after payment of £1.6m MatsSoft deferred consideration. Given the evident opportunity, management is expected to minimise free cash flow subject to a £1.0-1.5m buffer, through reinvestment in R&D and sales and marketing, with £16.6m ACV (annualised contract values) having grown 10% (Low-code ACV +21%). ACV in turn drives growth in recognised revenue (+13% underlying, including 22% from Low-code) as well as visibility, giving increased certainty to forecasts. Case studies abound to show the application of Low-code to client benefit, in the case of Hampshire Trust Bank delivering a project four months early and at one third of the anticipated cost; with such compelling alternatives to laborious and IT projects, Netcall’s Liberty Create solution grabs customer attention. With the cash flow certainty of the Liberty Converse customer engagement platform, and the opportunity in Liberty Create delivering evidence of a trend to momentum in growth in FY20 (June year-end), we reiterate our 90p target price.

Andrew Darley

020 7220 0547

adarley@finncap.com

 

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