EQS Group

DB: EQS

€90.4m market cap

€63 last close

EQS Group is a leading international technology provider for investor relations, corporate communications and compliance. More than 8,000 companies worldwide use its products and services to fulfil complex national and international information obligations to the global investment community.

Investment summary

Management has reiterated FY19 guidance following first half results, despite revenue growth at the interim stage being a little below its own expectations. H219 should provide better revenue and profit growth as new modules will stimulate growth and the internal investment requirement reduces. Our underlying forecasts are unchanged, but we have downgraded revenue and EBITDA forecasts for FY19 and FY20 to take account of the disposal of ARIVA. EQS continues to trade at a significant discount to its peers and the current share price is discounting growth well below management’s expectations. Its positioning as a provider of cloud-based IR and compliance services for corporates, with growing (recurring) SaaS revenues, remains attractive.

Y/E Dec
Revenue (€m)
EBITDA (€m)
PBT (€m)
EPS (c)
P/E (x)
P/CF (x)
2017A 30.4 2.4 0.8 36.97 170.4 N/A
2018A 36.2 0.3 0.7 51.09 123.3 N/A
2019E 37.6 3.1 (0.6) (26.77) N/A N/A
2020E 39.9 4.6 0.8 35.78 176.1 N/A
Last updated on 13/09/2019
Industry outlook

Gartner estimates the governance, risk and compliance segment at over US$5bn, growing at a CAGR of over 13%. 2019/20 should see a further raft of regulation on issues such as whistleblowing and increasing corporate transparency, following on from the benefits from regulation such as MiFID II. These all increase corporate administrative loads and carry heavy penalties for non-compliance, providing a positive backdrop for sales.

Last updated on 13/09/2019
Sector
TMT
Share price graph
Balance sheet
Forecast net debt (€m) 18.2
Forecast gearing ratio (%) 67
Price performance
%
1m
3m
12m
Actual (6.0) (6.7) (10.6)
Relative* (11.4) (8.9) (13.6)
52-week high/low €77.5/€62.5
*% relative to local index
Key management
Achim Weick CEO
André Marques CFO

Content on EQS Group