ketchup schreef op 29 mei 2020 11:47:
Short-term outlook is extremely uncertain with automotive production standing still
We now model for a deeper decline in 2020 while we expect that TT will come out stronger from this crisis
two paths
- Automotive: TT continues to win share from HERE
- Enterprise: TT is the alternative supplier for clients that do not want to use Google
a deeper decline in 2020:
IHS Markit expects a 25% decline in car sales in 2020 and typically this implies that car production well be even lower , TT gets paid based on production
TT's automotive biz shud do better than car production as
- take-rates of inbuild navigation will continue upward
- gaining market share
as this is a lump-sum biz it sees little impact from Covid-19
Consumer biz will decrease sharply , much less ( holiday) drive trips will push down an already strong declining biz.
as from 2021 stimulus plans for the sector appear to be in the making and seem to be geared towards environmental measures/electric vehicles
this typically increases in-dash penetration
net cash at the end of 2019 of 437m approximately 45% of TT's market cap
we estimate TT to generate over 200m of cash in 2020-23 F
this implies that very little value is attached to the long-term opportunity for the company
TT's long-term outlook is uncertain, the potential for strategic action, provide signficant upside risk, in our view.
( overname kandidaat )
estimates 2020 - 2021 - 2022
revenues: 542 - 639 - 723
Adj EBITDA: (30) - 13 - 36
Adj net profit: (101) - (54) - (19)
Adj EPS: ( 0.76) - (0.41) - (0.15)
gross profit: 435 - 525 - 621
OPEX: (755) - (592) - (646)
EBIT: ( 320) - (67) - (24)
Net profit: ( 256 ) - (54) - (19)
FCF: ( 30) - 78 - 87
Net Cash: 392 - 455 - 527
risk to the investment case
OPEX, in recent years the cost increases have surprised negatively ( accounting changes )
Loss of clients: TT's stock price was negatively impacted when it partly lost its Renault contract to Google
In the future we could see TT lose other important contracts
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nu aan een beurswaarde van 1 miljard euro met bijna de helft in cash , blijft dit aandeel met een onzekere outlook voor cijfers ( P/L basis EPS) , maar met een veelbelovende cash aanwas naar 500m plus een target voor zowel een vijandige benadering als vriendelijke exit
hopelijk kan het aandeel naar 10 euro op eigen kracht voordat iemand een move maakt.