Link Mobility - Top Sparebank Idea for 24

NordicGuy
LINK 24.01.2024 kl 10:00 7351

Link Mobility, Europe’s biggest SMS communication company just sold its US business at 14 times EBITDA for USD 260 Million. Link trades at only 8 times now which indicates the upside.

Link is one of the cheapest stock vs its peers due to its high leverage. The leverage is now resolved by the sale of the US business.

Ready for price re-rating

The full investment summary below:

https://fitinvestmentideas.com/2024/01/24/link-mobility-sparebank-top-idea-for-2024/
PHOinvestor
24.01.2024 kl 10:53 7297

En fin aksje å satse på nå, kjøpte meg inn på 8,0
NordicGuy
24.01.2024 kl 11:45 7248

I like the summary of the investment idea from the link above:

Summary

Link is cheap vs its peers as the Pareto slide shows. Link is cheap vs the transaction it just closed in the US. The reason for its low valuation was its high leverage, which is now resolved. Link is growing organically at 14% with a high cash conversion rate. Likely, acquisitions at lower multiples will accelerate growth further. Link successfully integrated 30 acquisitions into the profitable enterprise. It will do so in the future as well. Bright days ahead.
NordicGuy
24.01.2024 kl 15:20 7132

A new article on Link Mobility just published on SeekingAlpha - link below.
It may get some US investors involved and help the share price..

https://seekingalpha.com/article/4664433-link-mobility-europes-messaging-powerhouse-top-idea-for-2024
NordicGuy
25.01.2024 kl 09:25 6945

Copied from the article - Scandinavian brokers issued bullish reports in the last two weeks:

The leading Scandinavian brokers have all turned very bullish in January :

The Arctic Securities – published on 15 January 2024 research titled: “Link Mobility – Getting the message across – one to own in 2024.” Their Price Target is 23 NOK, a 30% upside from the current share price.

Pareto Securities – initiated their research coverage on 22/1/24 titled “Back to basics” with a Price Target of 25NOK, a 50% upside from the current share price.

Sparebank published their latest research on 8/1/24 titled “We expect business as usual in 4Q23 and solid free cash flow” with a Price Target of 25 NOK, a 50% upside from the current share price.

ABG Sundal Collier published their latest research on 23/1/24 titled “Link Mobility – An Undervalued Quality Company” with a Price Target of 24 NOK, a 40% upside from the current share price.
NordicGuy
25.01.2024 kl 12:26 6882

I found an open link to the SeekingAlpha article that was published yesterday:

https://seekingalpha.com/article/4664433?gt=483f5ee7d3bde128
NordicGuy
25.01.2024 kl 16:53 6781


The most interesting slide is the Pareto relative valuation slide, which shows that Link is one of the cheapest in the sector.

https://seekingalpha.com/article/4664433?gt=483f5ee7d3bde128


Garderobemannen
26.01.2024 kl 12:36 6564

Takk for bidrag til å utvide horisonten og kunnskapen vår om LINK.

Jeg tror imidlertid man skal ha i mente at LINK ikke er et selskap som pr idag driver innen SaaS-bransjen primært (selv om noen inntekter kommer fra dette (5,5 %), blant annet noe via kjøpet fra danske MarketingPlatform).

Derimot er LINK en av få ganske rendyrkede CPaaS-aktører.

LINK har som kjent tidligere uttrykt de ønsket å utvide over på CCaaS-markedet, kanskje en periode IoT-aaS, og kanantakelig også ha tenkt å utvide mot UCaaS, men har (etter mitt syn) heldigvis unnlatt å gjøre det. Andre større CPaaS-aktører har brent seg skikkelig på forsøk på å konvergere mot disse områdene. Både CCaaS- og UCaaS har noen meget ressurssterke aktører, for å si det mildt.

Oversikten du legger ved fra Pareto er derfor etter mitt syn ingen god sammenligning. Men konklusjonen din kan jeg likevel stille meg fullt ut bak - LINK er svært rimelig, med den utrolige verdikonserveringen de dokumenterte ved salget av MB, som ga den helt nye finansielle stillingen.
Redigert 27.01.2024 kl 17:55 Du må logge inn for å svare
NordicGuy
26.01.2024 kl 12:56 6533

Pareto has produced the relative valuation slide that is shown in the article. Therefore they believe the peers they selected are relevant.

Peer valuations are always only part of the puzzle. In this case indicating LINK is very cheap. We both agree on this
NordicGuy
21.02.2024 kl 13:33 5872

Slide from the Q4 presentation:

All-time high revenue at NOK 1 796 million
• Organic growth in fixed FX at 14%
• Strong market push related to Black Week and Christmas trading

All-time high gross profit at NOK 385 million
• Organic growth in fixed FX at 13%
• High growth on profitable OTT channels like RCS expands margins
• FY 23 organic gross profit growth in fixed FX was 7%

All-time high adjusted EBITDA at NOK 181 million
• Organic growth in fixed FX at 24%
• FY 23 organic adjusted EBITDA growth in fixed FX was 15%
• Profitability growth supported by cost reductions completed early 2023

Cash reserve NOK 3.4 billion after divestment of Message Broadcast
• Divestment of US subsidiary at highly attractive valuation closed on 3 January 2024

Leverage after close of US divestment at ~1.1x adjusted EBITDA
• Providing ample financing capacity for inorganic growth through M&A

Link to the presentation:
https://www.linkmobility.com/resources/investors/reports-and-presentations/quarterly-reports/LINK-4Q23-presentation.pdf
NordicGuy
21.02.2024 kl 13:53 5834

Acquisitions will drive the share price in the coming weeks. Slide from the Q4 presentation on this:

M&A strategy for additional inorganic growth
LINK completed more than 30 acquisitions last decade
• Historical acquisitions in Europe has generated significant excess equity value
• Expertise and financial capacity to strengthen acquisition activity
M&A play-book guidelines
• Strong local market position and strong telecom operator relationships
• Cash EBITDA positive and cash accretive to LINK from day one
• Solid, well-diversified customer portfolios with low churn
• ~80% overlapping technology strong commercial enterprise focus
• Synergy potential to create further value
Many bolt-ons and several level-up opportunities in Europe have priority
• More than NOK 200 million in additional EBITDA potential from M&A pipeline in Europe
• Acquisitions in Europe will drive cost synergies and enable quicker upselling potential
• Several level-up cases outside Europe in attractive markets in M&A pipeline

Link to the presentation:
https://www.linkmobility.com/resources/investors/reports-and-presentations/quarterly-reports/LINK-4Q23-presentation.pdf

Syden
22.02.2024 kl 21:12 5645

Tror vel det samme hender med Link som med Kahoot blir kjøpt opp og tatt av børs.
Sequia
23.02.2024 kl 08:13 5500

Ja det kan ikke utelukkes, ihvertfall dersom kursen blir liggende på disse nivåer i 2024
Syden
23.02.2024 kl 13:10 5399

Kan virke som at noen ikke vil ha kursen opp,
Så det samme i Kahoot.
Men jeg gikk ut med fin gevinst i Kahoot etter å ha sittet der i 15mnd
kokkohill
28.02.2024 kl 14:42 4995

Vil tro denne er bunnet ut for denne gangen
NordicGuy
05.03.2024 kl 10:46 4673

The latest Link Mobility presentation was published today for their Roadshow in Sweden.

https://www.linkmobility.com/investors/other-reports-and-presentations

NordicGuy
05.03.2024 kl 11:16 4638

Good slide from the new presentation they published today:

All-time high revenue at NOK 1 796 million
• Organic growth in fixed FX at 14%
• Strong market push related to Black Week and Christmas trading
All-time high gross profit at NOK 385 million
• Organic growth in fixed FX at 13%
• High growth on profitable OTT channels like RCS expands margins
• FY 23 organic gross profit growth in fixed FX was 7%
All-time high adjusted EBITDA at NOK 181 million
• Organic growth in fixed FX at 24%
• FY 23 organic adjusted EBITDA growth in fixed FX was 15%
• Profitability growth supported by cost reductions completed early 2023
Cash reserve NOK 3.4 billion after divestment of Message Broadcast
• Divestment of US subsidiary at highly attractive valuation closed on 3 January 2024
Leverage after close of US divestment at ~1.1x adjusted EBITDA
• Providing ample financing capacity for inorganic growth through M&A

https://a.storyblok.com/f/151608/x/bd8f9d6cd2/link_stockholm_march_2024.pdf
Sequia
05.03.2024 kl 13:49 4557

Roadshow, with which investment bank, ABG or SP1M?
NordicGuy
05.03.2024 kl 15:57 4478

Not sure
NordicGuy
05.03.2024 kl 16:11 4460

LInk Mobility SpareBank Top Idea list for March:

Attractive cash conversion

Valuation Trigger
1) NIBD/EBITDA 1x in 1Q24 (down from 4.8x) and
2) steady pace on growth and margins in January

• +110% net retention, 50k customers in Europe with low single digit
churn (2% in 3Q23) and attractive gross profit business wins points to
+10% revenue growth and high-single digit gross profit growth.
• With operational scalability inherent in volume increases in general and
from growth skewed towards existing customers increasing volumes in
particular, points to margin expansion and earnings growth more than
gross profit growth (+10% compared to 16% organic in constant
currency in 3Q23 and 12% YTD).
• Very strong cash conversion: EBITDA reported = cash flow from
operations over time (higher in 2023)
• Balance sheet fixed and refinancing risk out of the picture following the
sale of Message Broadcast
• Trades at a 2024 and 2025 P/CEPS of 11.4x and 10.4x.
NordicGuy
05.03.2024 kl 16:11 4459

LInk Mobility SpareBank Top Idea list for March:

Attractive cash conversion

Valuation Trigger
1) NIBD/EBITDA 1x in 1Q24 (down from 4.8x) and
2) steady pace on growth and margins in January

• +110% net retention, 50k customers in Europe with low single digit
churn (2% in 3Q23) and attractive gross profit business wins points to
+10% revenue growth and high-single digit gross profit growth.
• With operational scalability inherent in volume increases in general and
from growth skewed towards existing customers increasing volumes in
particular, points to margin expansion and earnings growth more than
gross profit growth (+10% compared to 16% organic in constant
currency in 3Q23 and 12% YTD).
• Very strong cash conversion: EBITDA reported = cash flow from
operations over time (higher in 2023)
• Balance sheet fixed and refinancing risk out of the picture following the
sale of Message Broadcast
• Trades at a 2024 and 2025 P/CEPS of 11.4x and 10.4x.
NordicGuy
11.03.2024 kl 11:14 4078

Link Management Believes Link share price is too low - Buyback Announced

Oslo, Norway, 11 March 2024. LINK Mobility Holding ASA ("LINK Mobility" or the
"Company") (OSE: LINK) has authorized a share repurchase program that allows the
Company to repurchase up to 17 million of its outstanding shares. The Company is
not obligated to repurchase any shares under the program. The program will be
conducted during the period from 11 March 2024 until 29 May 2024. LINK Mobility
may, however, at any time suspend or terminate the program.

The share repurchase program has been resolved by the Board of Directors of LINK
Mobility and is in accordance with the authorization granted to the Board by the
Annual General Meeting of LINK Mobility on 31 May 2023.

In furtherance of the program, LINK Mobility announces today that it has put in
place an agreement with Arctic Securities AS ("Arctic") for the repurchase of
the Company's shares in open market transactions on the Oslo Stock Exchange.
Under this agreement, Arctic will make its own trading decisions independently
of, and uninfluenced by, LINK Mobility.
NordicGuy
11.03.2024 kl 14:29 3996

Pareto summary of the buyback:

Link – NOK 290m (5.7%) share repurchase program
Link announced a 17m share repurchase program this morning. It equates to 5.7% of outstanding shares and NOK 290m at Friday’s closing price of NOK 17/share. Maximum value is set to NOK 400m. The program is running from today until 29th of May, at a max 381,052 share/day (25% of average daily trading volume in Feb). The purpose of the program is to meet obligations arising from employee incentive programs. Following the divestment of its US business, Link has approximately NOK 3.4bn in cash & NOK ~4bn in IBD (incl. lease). BUY/TP NOK 25
Syden
12.03.2024 kl 09:49 3813

Men vil dette tilbakekjøpet hjelp på aksjekursen?
For nå har den jobbet mellom 16/18 over lang tid.
Og hva ønsker dem størst aksjonærene her?
For selskapet går bra har masse penger på bok.
Men har aldri betalt utbytte.
Kommer vi her til å se ett salg av selskapet nå i nær fremtid?
For jeg tror vel dem store snart ønsker litt mer her.
Vi har sett mange Tech selskaper har blitt solgt og tatt av børs.
NordicGuy
09.04.2024 kl 16:35 3240

Another bullish report by SpareBank on LINK was published today. Does anybody have it?
Syden
10.04.2024 kl 09:40 3072

Ser ut som interessen for Link ser bedre ut.
Hva kan vi forvente oss når Q1 legges frem i mai?
Sequia
10.04.2024 kl 09:50 3048

Yes, but this is only the conclusion:

When buying Link Mobility you get 1) double digit organic growth supported by high barriers to entry (size needed to get direct access to channels owners), +110% net retention and low single digit churn (due to heavy system integration at the enterprise customers) from 50k customers across Nordics and Europe (of which the latter is lagging the Nordics on penetration by 3-5 years), 2) margin expansion towards 10-12% reported EBITDA margin that we argue is a normalized level given the current gross-margin setup (we currently model 9% in 2024 and 9.2% in 2025, up from 7.6% last year), which yield ~15% EBITDA growth, with 3) a rock-solid cash conversion (EBITDA reported is basically equal to cash flow from operations), 4) a company that has fixed the balance sheet and is now around 1x NIBD/EBITDA, but 5) still trades at P/CEPS (free cash flow to equity per share) of 13x in 2024 and 12x in 2025. That is why we continue to argue this is the best risk/reward within our coverage universe!.
NordicGuy
10.04.2024 kl 13:22 2953

Perfect, thank you.

It will be the first “cleaned” balance sheet after the sale of the US business - the first time investors will see debt reduced and US business out.

I hear Pareto is organising a roadshow for Link right after the results.

I am long and I am bullish. Since the idea was posted here, the stock is 15% up. My price target when the Q1 is reported is 21-22 NOK
Syden
15.04.2024 kl 11:48 2727

Går litt ned idag som mange andre også gjør.
Så vi får bare sitt å vente på at den stabiliser seg over 20 tallet .
NordicGuy
16.04.2024 kl 15:11 2551

Arctic very bullish on LINK. Today’s report:

Continued double-digit growth and ahead of consensus
LINK will report Q1’24 on 13 May and we are 6%/8% ahead of Factset consensus on GP/adj. EBITDA, modelling 10%/18% organic growth, which is backed by a continued high backlog and LINK seeing similar trends into 2024. The Q1 report should thus be another positive trigger with higher growth and showcasing scale, while a continued strong order intake and more upbeat outlook comments could come on top. We reiterate our BUY and NOK 25/sh TP as we continue to see favourable risk/reward with the shares trading at 12.5x/11.0x P/cEPS and 8%/10% FCF yield on our ’24/25e.
NordicGuy
17.04.2024 kl 15:23 2395

Sparebank today:

(+) LINK MOBILITY: Earlier today, CM.com issued a trading report. Says it sent 2bn messages in 1Q24 which represent a volume growth of 18% compared to last year and C it is now back to growth following four quarters with zero or negative growth in volume.

Link Mobility saw that up-tick from 2Q23 and we expect this to continue in 1Q24 for Link Mobility. Another supportive datapoint on the strong market Link Mobility commented on during 4Q23, reiterated in February and our experience talking to the company lately (with reference to our latest newsflash).
NordicGuy
17.04.2024 kl 15:47 2378

Arctic yesterday:

Continued double-digit growth and ahead of consensus
LINK will report Q1’24 on 13 May and we are 6%/8% ahead of Factset consensus on GP/adj.
EBITDA, modelling 10%/18% organic growth, which is backed by a continued high backlog
and LINK seeing similar trends into 2024. The Q1 report should thus be another positive
trigger with higher growth and showcasing scale, while a continued strong order intake and
more upbeat outlook comments could come on top. We reiterate our BUY and NOK 25/sh
TP as we continue to see favourable risk/reward with the shares trading at 12.5x/11.0x P/
cEPS and 8%/10% FCF yield on our ’24/25e.
NordicGuy
17.04.2024 kl 15:50 2368

Pareto Monday:

We expect Q1’24 to mark an extension of the
positive business momentum from 2023, with
organic gross profit growth +8.5% y/y.
• While sequentially down from Q4 (+12.8% y/y),
we highlight a tougher comp & Easter Holiday
falling into Q1, likely to push some messaging
spend over into Q2.
• No big changes to the key cost drivers (salary
negotiations take place in Q2), and we end up
with an EBITDA adj. estimate NOK 158m, +15.2%
y/y vs. consensus at NOK 153m.
• This implies a margin improvement of +3.2pp y/y
(ex. North America), as organic GP growth
continues to drive operational leverage.
Skogens
20.04.2024 kl 12:48 2120

Oppfordrer dere til å gå inn på Finansavisen og legge inn deres estimater
https://www.finansavisen.no/ticker/LINK/nyheter
Syden
21.04.2024 kl 16:28 1954

Hva tror dere vi kan forvente av kurs når q1 legges frem den
13mai? Men tror man det også kan komme noen andre gode nyheter fra selskapet ?
Syden
26.04.2024 kl 10:06 1537

Veldig still på Link tråen nå om dagen✅.
Sitter alle å ventet på q1 13 mai.

Heller ikke så mye trøkk i aksjen heller om dagen.
Men jeg tror det beste er å bare sitt stille å vente.
For enten kommer det oppkjøp eller så blir Link kjøpt opp på lik linje
som Kahoot ble sist sommer .


NordicGuy
07.05.2024 kl 15:16 1006

very bullish into the Q1 report next week. So are all the brokers
Syden
10.05.2024 kl 10:44 743

Sist dag før q1 legges frem på mandag,
Får vi en pen oppgang da?
Serboss
13.05.2024 kl 07:40 502

Link Mobility varsler flere oppkjøp
06:40
Fredrick C. Ekeseth
DEL
Mobiltjenesteselskapet Link Mobility fikk et resultat før skatt på 340,5 millioner kroner i første kvartal, sammenlignet med et underskudd på 31 millioner kroner i samme periode ifjor, ifølge en børsmelding mandag.

Driftsinntektene var på nær 1,7 milliarder kroner i første kvartal (1,3).

Resultatet før skatt og avskrivninger (EBITDA) var på nær 140 millioner kroner (117).

Link hadde en kontantbeholdning på 3,4 milliarder kroner per utgangen av første kvartal.

«Den sterke balansen gjør det mulig for Link å fortsette sin historie med uorganisk vekst, med mer enn 30 oppkjøp i Europa i løpet av det siste tiåret», skriver selskapet.

Link legger til å være i «pågående og konstruktive» samtaler over et bredt utvalg oppkjøpskandidater.
Gullhaugen
13.05.2024 kl 07:56 455

Teknisk så bør denne gå til 35-38 nå.