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Added 6 months ago
#Bull Case

SP has rallied recently tracking the IT sector on the ASX - may have some pull back but should over the long term contiune to rise - Gotta jump in somewhere. 

Customers include but are not limited to those listed below

  • Automotive: i.e. Tesla, Ford, Volkswagen
  • Aerospace: i.e. Boeing, Lockheed Martin, SpaceX
  • Life Sciences: i.e. Cochlear, ResMed, Phillips n Mobile Devices: i.e. SAGEM, Honeywell
  • Consumer Electronics: Apple, Amazon, Fitbit, Bose
  • Electronics & High tech: Google, G.E.
  • Research & Education: John Hopkins, CSIRO n Industrial Controls: Siemens
  • Computers: Microsoft, Lenovo n Semi conductors: Qualcomm
 
Last edited 2 months ago
#HY2019 Results

Wow.

Revenue growth of 24% to US$78.1m. Well and truly on track to achieve (and beat) long held 2020 target of US$200m in revenue.

Even better, EBITDA margin was 36.7%, ahead of 35% target. 

Net profit up a massive 58%.

Name any of their key metrics -- they ALL moved in the right direction. Of particular note was China, which saw a 49% lift in revenue (there's a lot of potential remaining here too).

Of course, still debt free with US$58m in cash.

Company has provided an aspiration goal of US$500m in revenue by 2025 and believes the EBITDA margin could expand to 40%. That would represent top line growth of 20% per annum between FY18 and FY19.

On that goal, EBITDA would grow by ~24% per annum between FY18 and FY25

Valuation is the hard part here. Using trailing twelve months (TTM) figures and an US/AUD exchange rate of 72c:

P/S ~20, EV/EBITDA ~54, PE ~67

To put that in context, Alphabet (Google), which is also growing top line at ~20%, trades on a PE of ~26 and a PS of 5.6. Altium is a fantastic tech company, but then again so is Google, right?

I have zero concerns about the quality and strength of the business. My worry is that unless shares can mainatin very high multiples, shareholders could see pretty ordinary returns from here. ALU is a $4.3b company, and it's not easy to maintain high and sustainted levels of growth at this scale. 

I have consistently under-estimated what the market will pay for this company. So be warned... 

Investor presentation can be found here

AFR article here

 
Last edited 7 months ago
#Bull Case
stale

-Strong tailwind of increasing demand for electronic devices as they become ever more integrated into day to day life

-A critical component of devices are circuit boards 

-Need for a tool to design circuit boards

-Altimum's product is the solution

 
Added 5 months ago
#Bull Case

Possiblilty of dominance due to world first position head start in ever-growing IOT market. 

 
Added 6 months ago
#Bull Case
stale

An increblie company in terms of quality. Great growth metrics backed by a vision of being a market dominator by 2025. Stock has run up hard recently and may be considered expensive in some valuations, however this is a great example of willing to pay a premium price for a premium business.

 
Last edited 6 months ago
#live wire
stale

https://www.livewiremarkets.com/wires/altium-limited-earnings-drivers-appealing-fundamentals

no of shares 130M, forecasts: Net Profit in 2021 $85M, rev $260M, PE 44

SP=85 x 44 / 130 = $28.77  discount back 2 yrs at 10% = $23.77

 

 

 
Added 8 months ago
#HY2019 Results
stale

Half year FY 19 was an amazing result. If they achieve their USD 500M target by 2025 with 40% EBITDA then this is going to $60+. I sold a third of my portfolio today but will add to my position if there is a market sell down. The rest I have held now for over 5 years and  have no intention of selling. There is a huge future for ALU if they can get market dominance, this company has the potential to be multiples of its current size. Not cheap on todays numbers, but an outstanding business with incredible management.