HOLD Anchor Capital says that this JSE-l i sted technolog y play may be entering value territory after a recent sell-off. The asset manager said that if the share price recovered, the counter would still only be trading on a 12 times earnings multiple in rand terms and the company had received positive feedback following a meeting with management.
The asset manager told cl ients: “With regard to the business in genera l , we l i ked what t he company said about the developments and the prospects. It seems to be doing a lot to take advantage of new technologies and t he move towards mobile devices. It has also developed offerings around the cloud. The software portion of t he business, which i s growing through the cloud offerings, accounts for 20% of the total business and provides higher margins than the more t raditional /non- digital offerings, with lower risk and a recurring income stream.” the company’s undemanding valuation (for ward PE of 8.4 times) and subsequent earnings growth (20% threeyear CAGR) on our estimates.”