2 Technology Stocks On An Upswing – APX and APT

  • Dec 27, 2018 AEDT
  • Team Kalkine
2 Technology Stocks On An Upswing – APX and APT

The below mention Technology stocks have witnessed strong operational performance during FY 2018. Both the stocks have reported significant improvement in their revenues and expect further growth in the future. Let us take a look at these stocks-

Appen Limited (ASX: APX)

Appen Limited (ASX: APX) is a provider of high-quality training data which is used for the improvement of machine learning at scale. In November 2018, the company announced its FY 2018 earning update in which the company announced that it is expecting its underlying EBITDA to be in the range of $62 million to $65 million which is an improvement over an earlier estimate of $54m to $59m. The main reason behind this improvement is the sharp increase in monthly revenues which were mainly generated from the existing projects from existing customers. In the 1H of FY 2018, the revenues of the company increased by 106 percent to $152.8 million as compared to the previous corresponding year. The Underlying NPAT of the company grew by 119 percent to $17.8 million and statutory NPAT increased by 73 percent to $14.0 million. The company reported an Underlying EBITDA of $25.6 million and statutory EBITDA of $23.9 million in 1H 2018. In the first half of 2018, the board declared an interim dividend of 4.0c per share, fully franked which is up 33 percent higher than 1H 2017. 

In the last six months, the share price of APX decreased by 11.82 percent as on 24 December 2018 and traded at a PE ratio of 61.390x. APX’s shares traded at $12.560 (+5.193% Intraday) with a market capitalization of circa $1.27 billion as on 27 December 2018.

Afterpay Touch group Limited (ASX: APT)

Technology-driven payments company Afterpay Touch group Limited (ASX: APT) is currently processing over 10 percent of all Australian online commerce with over 2.5 million customers, over 20,000 retail partnerships. In November 2018, the company completed the sale of its European e-Services business to Nelumbo Limited for a total consideration of $7.5 million.

In FY18 the Afterpay Touch Group delivered strong financial performance with revenue and other income increased by 390 percent to $142.3 million and underlying merchant sales increasing by 289 percent to $2.18 billion. As at 30 October 2018, the company had a decent balance sheet position with cash of $30.2 million and net debt of $28.7 million.  In FY 2019, the company is experiencing strong growth in respect to all key metrics. The repeat customer behavior remained strong in FY 2019 and represented well over 90 percent of monthly gross merchandise value (GMV).

In August 2018, the company completed the capital raising of $117 million through an institutional placement which was supported mainly by existing shareholders and new investors and was oversubscribed.

In the last six months, the share price APT increased by 32.02 percent as on 24 December 2018. APT’s shares traded at $12.420 (+6.063% intraday) with a market capitalization of circa $2.74 billion as on 27 December 2018 (AEST 4:00 pm).


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