Total Shares = ~375m
Share Price = ~$3 /Share
Market Cap = $1125m
Cash at hand = $140m
Enterprise Value = $985m
FY21 Revenue = $192.2m ( 60% revenue from Europe, 20% from North America and remaining 20% from Australia)
( 85% of revenues are recurring)
In FY21, EML generated $48m Cash from Operating activity, based on the guidance for FY22 It will generate $53m Cash from Operating activity)
Valuation:
at $3 = EV/EBITDA ratio is ~15
In other words, If you buy EML with an Enterprise Value of $985m ( i.e $3 a Share), it generates 5.3% yield in cash in FY22 ( i.e it generate 53m of cash). EML is growing rapidly so this (in mind) is very attractive.
Is Inflation good for EML?
- EML doesn't rely on debt, it has sufficient cash
- It earns more interest on money if interest rates go up
- because of inflation, GDV should increase at a higher rate and Hence EML's revenue
Two near term issues
- Central Bank of Ireland regulation issue ( its been mainly sorted but not 100%)
- Shine Lawyers Class Action ( EML denies any liability and defending the proceedings - will wait for the outcome)
Following is Q1 FY22 Trading update
![75a163a20bdfb1fcf91d5596091bdb04bd1ab3.png](//strawman.com/member/uploads/objects/15/75a163a20bdfb1fcf91d5596091bdb04bd1ab3.png)
Following FY2022 Guidance
![65197f909c3290d59da5ff895d89090046beff.png](//strawman.com/member/uploads/objects/8a/65197f909c3290d59da5ff895d89090046beff.png)
So far evidence suggests that it is growing its market share.
![fbf402b412aa014fdd5e2b15b0ba4573be3e70.png](//strawman.com/member/uploads/objects/14/fbf402b412aa014fdd5e2b15b0ba4573be3e70.png)
![eece9bcbd3e0e1f0cce9c17aa2858f4d9e72f8.png](//strawman.com/member/uploads/objects/99/eece9bcbd3e0e1f0cce9c17aa2858f4d9e72f8.png)