Pushpay 5 years out, page-41

Hi Jogo

My initial response is that I am at odds with your statement......”A restraining factor, however, is its reducing operating margin”.

The Gross Margin has lifted to above 63% and the costs are clearly being contained as per the last Financials (I seem to recall at just above 2%). So with projected increased Revenue, the operating margin or EBITDA must increase. They recently lifted guidance for FY20 where Revenue remained in the same target band and the EBITDA range essentially increased by USD 1 m. Again, does not support an argument that operating margins are declining.

Joao, I need to go back to my numbers, but in the mean time would appreciate if if you could share your actual calculation supporting a decline in operating margin. You have previously made mention of your valuation method where the SP features. Would like to understand that.

Wheras you appear to use your formula output in comparison with other ‘momentum’ stocks, the only time I consider other stocks is to establish a likely PER. So future EPS (my projection thereof ) x Likely PER yielding a future SP (becomes my target price). Therefore, nothing in my calculations / projections is in anyway anchored to the ruling SP.

Will go back through my numbers this evening.

Rokewa