Active Member Straws

×

Add a Straw

Note: Maximum file size should not exceed 2 MB and file type should be JPG, PNG, PDF or DOC.
Private — only you will be able to see this Straw
Last edited 2 months ago
#Broker / Analyst Views

23 December 2019:  Ord Minnett:  Atomos Limited:  A resolution to grow  

"We initiate coverage of innovative media device business, Atomos (AMS), with a Buy recommendation and $1.75 price target, implying a total shareholder return of 21%. Atomos has spent the past three years investing heavily in its IP with the design of a new chip to power its video and picture display and capture screens. This work culminated in the release of NinjaV, a hit product with Pro Video users. The business is now poised to leverage its significant R&D and proprietary relationships to push deeper into the Social and Entertainment markets which are worth multiples of Pro Video where Atomos has had most success to date. We expect operating leverage to drive EBITDA and NPAT growth of 49% pa and 71% pa respectively (FY20-25) from revenue growth of 21% pa. Buy."

----------------------------------

 

Disclosure:  Not Held.

 
Last edited 5 months ago
#Risks

It is worth keeping in mind that this is really a hardware/device company, which doesn't have a huge moat. While I have doubled down on AMS in my Strawman scorecard, I am acutely aware of the risk of new competitors taking market share from AMS.

An example of a bear thesis - GoPro. See the atached image of the share price over the past 5 years.

GoPro developed products for a more mainstream market compared to AMS and so was always likely to attract strong competition.

I will continue to hold so long as growth continues to accelerate (or at least hold steady). If growth slows, or a significant competitor enters the market, I will bail out quickly. *29/9/19 update* - I closed one position after a stong run, now just hold a single Strawman position.

 
Added 2 weeks ago
#Bull Case

$1.5