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fatborgslim

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10/02/22

17:33

Post #: 59491680
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Originally posted by Patient: ↑

Mentioned in DMX Aust Fund Jan Report as a new holding

EML Payments

EML is a leading provider of payment solutions with its origins in providing prepaid shopping mall cards, and expanding into various niches including reloadable cards, payment solutions to replace US cheques, and into the emerging open/digital banking space. EML Payments can be thought of as providing the piping or back-end of its various financial services. Once EML sets up a programme with a client, it typically “clips the ticket” on transactions which provides a long stream of consistent revenues as the programme gets to scale.

Growth has historically been strong with a combination of acquired and organic growth. In FY21, EML cited 34% organic growth in its key reloadable card segment while prepaid gift cards were flat as malls have been impacted by COVID. With the world slowly reopening, EML is well-positioned to capitalise on increased in-store activity.

In addition to slower growth due to COVID, EML’s shares have been hit by uncertainties around regulatory risk – in particular, an on-going (though hopefully soon-to-be-resolved) investigation by the Central Bank of Ireland. We believe the market’s focus on short-term operating softness together with an over-focus on regulatory action has weighed on its share price, which has fallen from over $5 to $3. In our estimation, at these levels the market is failing to recognise the long-term growth potential at high incremental margins. Further, as a collector of cash ahead of paying funds out (through its prepaid/voucher-like services), the company holds considerable float which earns ~0% interest but may in the years ahead offer a powerful earnings tail-wind as interest rates potentially increase.

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DMX reports are always a great read. I've been an EML holder for a wild couple of years, so it's good to get a vote of confidence from DMX.

EML Price at posting: $3.20 Sentiment: Hold Disclosure: Held
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Add EML (ASX) to my watchlist

(20min delay)
Last 77.8¢		Change -0.018(2.20%)		Mkt cap ! $292.6M

Open	High	Low	Value	Volume
79.5¢	79.5¢	77.0¢	$644.5K	824.7K

Buyers (Bids)

No.	Vol.	Price($)
6	10706	77.5¢

Sellers (Offers)

Price($)	Vol.	No.
78.0¢	20441	13

View Market Depth

No.	Vol.	Price($)
7	13097	0.775
20	80037	0.770
12	107663	0.765
14	98983	0.760
8	152923	0.755

Price($)	Vol.	No.
0.780	19889	12
0.785	27244	8
0.790	87996	11
0.795	5486	4
0.800	100825	3

Last trade - 14.28pm 27/08/2024 (20 minute delay)

EML (ASX) Chart

EML Chart, page-961

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EML Chart, page-961

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