1H was a very messy and poor result for EML, can't argue...

1H was a very messy and poor result for EML, can't argue about that. with all the distractions and headwinds of CBI, it is impressive to see revenue growth of 20%+ continue!

EML doesn't have a revenue growth issue like some companies but more of a short term increase in cost base issue.

2H run rate of $120m cost base is a better representation and so a 10% cost base increase or $12m in FY23 is more likely.

if one assumes EML maintains 20% revenue growth next year they will add $50m of revenue with 2H GM guided to 72%!

this implies an incremental $35m of GM in FY23 and $23m of Ebitda on top of FY22 forecast Ebitda at the midpoint of guidance of $62m.

so FY23 Ebitda should be $85m ($62m+$23m) rather than current consensus of $73m (upgrades later this year)!!

EML is finally enjoying some tailwinds with interest rates rising and currency tailwinds.

I think investors are not forward looking enough and so it will take another 6 months for the stock to re rate.

I think it is quite likely Nuapay (open banking) will contribute meaningfully in FY24 to Ebitda and a $120m Ebitda figure at that point in time isn't out of the question (assuming 200bps of rate rises globally by then adds $30m of incremental Ebitda )

on an applied 25x multiple that's $8.20 share price!!