What All You Need To Know About The Micro Focus International Plc (MCRO.L)

  • Feb 21, 2019 GMT
  • Team Kalkine
What All You Need To Know About The Micro Focus International Plc (MCRO.L)

Business Overview

Micro Focus is engaged in delivering and supporting software solutions. It is a pure-play software firm in the world, focused on developing, selling and supporting software. The company focuses on offering an invariably high level of consumer satisfaction through extraordinary product implementation. Company's share entered the broader benchmark index FTSE 100 on 6th September 2016. It is the third largest software development company listed on the broader equity index FTSE 100 and largest UK based company listed in the United Stated bourses.

As on 14th February 2019, Company reported its unaudited preliminary results for the 18-months ended 31st October 2018.

Key Product Portfolio

  • Analytics and Big Data
  • Application development, test and delivery
  • COBOL
  • Collaboration solutions
  • Information Management and Governance
  • Business continuity
  • IT operations management
  • Mainframe
  • Security

Key People

  • Stephen Murdoch, Chief Executive Officer
  • Kevin Loosemore, Chairman
  • Karen Slatford, Director

Unaudited preliminary results for the 18 months ended 31st October 2018 ($ million)

Source: (Company Filing, LSE)

Key Takeaways

  • The company has reported group revenue of $4,754.4 million and an operating profit of $376.8 million for the 18 months ended 31st October 2018.
  • Pro-forma revenue of $4,058.0 million for the twelve months ended 31st October 2018, shows 5.3% decline on pro-forma constant currency basis as compared to $4,286.8 million reported in 2017.
  • Group’s Adjusted EBITDA stood at $1,529.6 million for the 12 months ended 31st October 2018 against $1,401.1 million reported last year.
  • The company reported 37.7% Adjusted EBITDA margin for the 12 months ended 31st October 2018 against 33.1% reported last year.

 

SWOT Analysis

Strengths

  • Diverse Channel Presence
  • Business Performance: Micro Focus

Weaknesses

  • Net Working Capital Deficit

Opportunities

  • Merger with HPE Software business

Threats

  • Fragility of Network
  • Rapid Technological Changes

One Year Stock Performance

(Source: LSE)

Stock Price Commentary

  • On 19th February 2019, Micro Focus stock closed at GBp 1,812, up by 3.63 per cent against its previous day closing price.
  • Stock's 52 weeks High and Low is GBp 2,077.00/GBp 782.20. At the closing price, the share was trading 12.76 per cent lower than its 52w High and 131.65 per cent higher than its 52w low.
  • In last one-year, Micro Focus share has given negative returns of 11.95 per cent.
  • Stock’s average traded volume for 5 days was 2,295,868.00 and 30 days – 1,279,767.70. The average traded volume for 5 days was up by 79.40 per cent as compared to 30 days average traded volume.
  • On the valuation front, the stock was trading at a trailing twelve months PE multiple of 12.4x as compared to the industry median of 10.4x.
  • The company’s stock beta was 1.43, reflecting relatively high volatility as compared to the benchmark index.
  • Total outstanding market capitalization was around £7.42 billion and a dividend yield of 4.92 per cent.

Conclusion

The company’s growth prospects look favourable as innovations have been done to cut down on costs. Given the current trading levels which indicate the stock movement towards 52-week high with support coming from few growth drivers like $110 million extended share buyback programme and accelerated revenue growth, the market can keep a watch on Micro Focus stock going ahead.

With Bank of England reducing the interest rates to a historic low level, the spotlight is back on diverse investment opportunities. 

Amidst this, are you getting worried about these falling interest rates and wondering where to put your money?

Well! Team Kalkine has a solution for you. You still can earn a relatively stable income by putting money in the dividend-paying stocks.

We think it is the perfect time when you should start accumulating selective dividend stocks to beat the low-interest rates, while we provide a tailored offering in view of valuable stock opportunities and any dividend cut backs to be considered amid scenarios including a prolonged market meltdown.

To know more about these dividend stocks, click here

CLICK HERE FOR YOUR FREE REPORT!
   
x
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK