Market cap $145 million
PE Ratio 42 .
Operate in 2 segments : s/w and services. Thank you @Duffshot38 , the Baby Giant podcast provides some interesting insights into the business model .
Very long sale cycles – hard to win and hard to lose customers .
I tend to disagree with Claud’s comments that they can resell the s/w easily to other clients . The s/w requires a lot of customisation based on the local market
legislation and compliance , therefore acquisition of other businesses ( Egssis as an example ) would be required to penetrate the local market .
Here's the link to EOL’s presentation , and it states “ to maximise the synergies the integration is expected to take approx. 24 months “ : https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02429860-2A1327742?access_token=83ff96335c2d45a094df02a206a39ff4
These “ integrations “ can go belly up easily since there are clashes and cultural/management style differences . Human capital is extremely important in s/w development , and a good example was acquisition of MatrikonOPC by Honeywell .
https://www.automation.com/en-us/articles/2013-2/opc-ua-adoption-by-honeywell-process-solutions
Matrikon in Newcastle had a real start up and Agile working environment . Honeywell , with a heavy handed overseas controlling micromanagement style , lost 80% of Matrikon’s people within 2 years , and decided to shut down this office after 2.5 years .
Personally , I wouldn’t invest in EOL since this is not an easily scalable technology . EOL operates in highly regulated and controlled industries that require substantial investment ( hard to grow organically ) and constantly rising development costs .
I see Claude Walker had EOL as a buy on 1st Aug: "Energy One is already my largest shareholding".
"For me personally, Energy One is one of my favourite investment opportunities on the ASX precisely because the business is earnestly and profitably positioned to provide increasing value in tomorrow’s energy network."
https://arichlife.com.au/energy-one-asx-eol-is-a-buy-last-traded-price-5-08/
Given that international expansion is a core part of the growth strategy for EOL, it would be good to have some research done on systems available in Europe and North America. I worked in international energy markets a decade ago, and there were a lot of alternatives available at the time - no doubt at least some of these have made the transition to SaaS. I'll do a bit of digging but wondered if any StrawPeople are currently active in the space?
For the deep dive I am planning on going deep into the narrative - what has management said vs what they achieved.