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Original-Research: q.beyond AG - from NuWays AG
04.10.2024 / 09:25 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
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The issuer is solely responsible for the content of this research. The
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Classification of NuWays AG to q.beyond AG
Company Name: q.beyond AG
ISIN: DE0005137004
Reason for the research: Update
Recommendation: BUY
from: 04.10.2024
Target price: EUR 1.10
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Philipp Sennewald
Conference feedback: Efficiency measures bearing fruit
Topic: This week, we hosted the European MidCap Conference in Paris where we
sat down with q.beyond CEO Rixen and CFO Wolters for some insightful
meetings. Here are the key takeaways:
Margin expansion. Management reiterated that it is on track for continues
margin expansion, confirming the targets for FY '24e (EUR 8-10m) and FY '25e
(7-8% margin). The company identified three layers to achieve this: (1)
Focusing the business model on acquiring consulting and development orders,
which consequently leads to orders for operations (Managed Services).
According to management, a 5pp higher share of consulting & development
revenues will lead to 2pp gross margin expansion. (2) Significantly
increasing the near- and off-shoring ratio. Since 2020, q.beyond has lifted
the ratio to 13% and is targeting 20% until FY '25e and 30% by FY '28e,
stating that 5pp increase in the near- and off-shoring ratio allows for a
1pp gross margin lift. (3) Increasingly implementing AI, especially in
Managed Services (50% of workforce), i.e. call center and service desk
automation, going forward. In
our view, this could lead to significant cost savings in the mid-term. Based
on this, the company's targets seem absolutely achievable and are in line
with our estimates.
M&A to fuel growth. Sitting on a comfortable net cash position of > EUR 30m,
management reiterated that it is currently building up an M&A pipeline, with
the intention for a first deal in the course of FY '25e. Here, the company
will focus on targets with software-based industry knowledge, preferably in
the public, healthcare or energy sector. Moreover, CEO Rixen stated, that
another goal would be to enter new regional markets via M&A. Overall, we
expect targets to be in the range of EUR 10-20m sales. Hence, we expect
several acquisitions in the coming years. In addition to the strong cash
positions, the company also still owns their own data center in Hamburg,
which could probably be sold for EUR 40-50m (eNuW) in order to unlock
additional funds.
Promising current trading. After the consulting business had a lackluster H1
performance (-11% yoy), management made a promising appearance regarding the
performance in Q3, stating that the company achieved a higher utilization
rate than in the previous quarters.
Valuation continues to look undemanding as shares are trading at only 6.1x
EV/EBITDA
You can download the research here: http://www.more-ir.de/d/30991.pdf
For additional information visit our website: www.nuways-ag.com/research
Contact for questions:
NuWays AG - Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss
bestimmter Börsengeschäfte.
Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben
analysierten Unternehmen befinden sich in der vollständigen Analyse.
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2002235 04.10.2024 CET/CEST
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