Forum Topics Saas buy list
Goldfish
Added 4 weeks ago

I thought it would be useful to get others opinions re Saas buying opportunities

I personally love moments like this, where the market settles on a narrative "AI is going to kill software companies" and indiscriminately sells off everything.

I'm going to post about 3 companies that I am looking at buying. I'm sure there are more. Wish I had more time right now (work + kids sports both super-busy, bad timing)

1. CAT

This one is no stranger to Strawman. The price has more than halved (from what was probably a bit of over-exuberant peak). I just don't see CAT as being vulnerable to AI disruption. It collects data from devices, video etc and integrates it. Still growing fairly rapidly and adding to its impressive list of professional sports teams

2. VGL

Vista Group. Much less known on SM. Provides software to the cinema and film industries. Had some tough times over COVID, but now growing well and inflecting into profitability. Share price was trending up prior to "software-geddon". Quite cheap on EV/revenue of 2.8. I don't see it as vulnerable to AI, provides a full range of services including ticketing, food sales, billing, advertising, film distribution etc. Downside is that revenue is tied to the cinema industry's fortunes (ie cyclical)

3. FCL

Software for insurance companies. Mission critical and (again) not particularly vulnerable to AI IMO. Similar to VGL, the share price had been improving prior to "software-geddon", on improving results and inflection to profitability. Also cheapish, on EV/revenue a bit over 3. Very sticky clients.

Very keen to hear others thoughts on the above, plus other opportunities

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mikebrisy
Added 4 weeks ago

@Goldfish you asked for views:

$CAT Agree. Overpriced at $7.50 (so I sold). Undervalued at $3.40. In RL. I progressively added again from $6.50 all the way down to $3.50. Now 9% of my RL ASX portfolio, and a high conviction holding. Devices, data, and deep expertise across multiple sports, and premium professional logos/brand all contirbute to the moat, supported by capable management.

$VGL ad $FCL - don't hold; never had; I haven't been able to develop an investment thesis, but equally haven't put in much effort as I don't know much about either industry verticle. (Not my zone of competence)

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lowway
Added 4 weeks ago

Nice post @Goldfish and very topical ATM. I'll ride the same train as @mikebrisy with $CAT. Great management and you've got to love the company that owns the data. I was far too slow to jump on board as they shot to the moon and then they ran way past my buy price. I've now started slowly accumulating IRL and will do the same in my SM portfolio next week. I have no opinion on the others, but always keen to take a look or to read others' views, opinions or valuations if they see merit there.

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Keyboardcat999
Added 4 weeks ago

Certainly feels like there's some good opportunities right now if you think SaaS will bounce back. On Thursday I picked up some ASX.ATEC given how broad-based the sell off has been and this just seemed like the simple solution. Would prefer if it had a higher weighting to TNE, but oh well.

I was waiting for HUB to sell down further, but it has been surprisingly resilient. At the current levels it still looks too expensive.

On the NASDAQ Intuit looks reasonably cheap, but I'm really waiting for Shopify to sell down further and would prefer to put cash towards that instead.

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