disaster asset management f irm Anchor Capital says that the current pricing of the newly listed microlending and financial services group is wrong. Portfolio manager Peter Armitage told clients: “Our view is that the share is undervalued and is pricing in disaster – and so far there are no signs of that. On the contrary, the company announced an impressive set of maiden results yesterday, with normalised HEPS up 17.1% to 81.6c (normalised earnings up 31.3%, but this was diluted by the listing capital raised, which resulted in some lazy capital).”
BUY In a note to clients entitled: Transaction Capital – priced for the f inancials from last year, as you can imagine, the margins in this business are huge. From sales of € 20.3bn, operating profit of €3.3bn was realised. The share trades at €104, and earnings for this year are expected to come in around €4.88. A multiple of 21 certainly is not cheap but I never expected it to be. This company is experiencing double digit growth.”
SELL trading update from the group. This is despite the loss of the group’s previous CEO and a number of costs coming through in the most recent numbers. He adds that the group still holds incredibly valuable Intellectual Property (IP) that makes up its NAV of 24.5c/share and a tangible net asset value of 6.1c/share. With Ansys trading at around 18c, this suggests there’s some value to be had here.