GB Group plc

Numbers downgrades… does the story hold?

  • Companies : GB Group plc

DAVY VIEW

As the enterprise software spending environment weakens, we lower our GB Group (GBG) revenue estimates for FY23, FY24 and FY25 by 3%, 6% and 6%, respectively. Hitting the target adjusted operating profit range of 23-24% looks feasible, although we downgrade these numbers in absolute terms. The H223 ‘ask’ looked to be too much considering FX headwinds and tougher growth comps. Further, we cannot help but think that a metric that excludes amortisation of acquired intangibles is simply the wrong metric for GBG. We retain our ‘Outperform’ recommendation on valuation and another potential private equity bid.

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Jan 26 2023, 07:00 GMT

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