Company Report
Last edited 2 years ago
PerformanceCommunity EngagementCommunity Endorsement
ranked
#31
Performance (62m)
2.8% pa
Followed by
128
Straws
Sort by:
Recent
Content is delayed by one month. Upgrade your membership to unlock all content. Click for membership options.
#Bull Case
stale
Added 2 years ago

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


Following FY2022 Guidance

65197f909c3290d59da5ff895d89090046beff.png


So far evidence suggests that it is growing its market share.

fbf402b412aa014fdd5e2b15b0ba4573be3e70.png

eece9bcbd3e0e1f0cce9c17aa2858f4d9e72f8.png