Shaw and Partners has recently initiated on KYP with a 28 cent price target. Summary below. Link to note above. Would be good to hear any analysis from others on this?
Shaw and Partners initiate coverage on Kinatico (KYP) with a Buy rating, driven by strong growth prospects and structural tailwinds. KYP, a provider of compliance software, is expected to grow revenue to $33.9M by FY27, with SaaS revenue increasing by 41% CAGR from FY24-27. The company is transitioning to a SaaS-based model, aiming for 80% of its revenue from SaaS by 2027. With high-quality clients like BHP and low churn, KYP is well-positioned for long-term growth, driven by regulatory tailwinds such as the Security of Critical Infrastructure Act (SOCI) and the Aged Care Royal Commission.KYP has a strong management team, impressive SaaS revenue growth (>40% YoY), and a solid balance sheet with $10M in net cash. The company is catalyst-rich, with upcoming events like the launch of the ComplianceX platform and international expansion in 2026. With a target price of $0.28, representing a 65% total shareholder return, KYP trades at a low valuation (NTM EV/SaaS revenue of 3.7x). Shaw and Partners expect the company to achieve significant operating leverage, forecasting 11% cash EBITDA margins by FY27.
KYP Price at posting:
17.0¢ Sentiment: Buy Disclosure: Held
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