FinTech Group AG
29.08.2018 - Equity Research Report (english) // buy
Research Report (Anno) - FinTech Group AG - english
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ISIN: DE000FTG1111
Branche: Finanzen-Beteiligungen
Rating: buy
Kurs bei Erstellung in €: 29,15
Kursziel in €: 41,70
Mögl. Interessenskonflikt gem. §34b Abs.1 WpHG und FinAnv: 5a;6a;11
In the past fiscal year, FinTech Group AG finalised the sharpening of its profile by the merger and packaging of individual business units. The “Make 2 out of 5” strategy achieved a significant streamlining of the group structure and reorganised the business units according to the Financial Services (FIN) and Technologies (TECH) business model.
However, the company is continuing to act through the known flatex and ViTrade brands as one of the largest online brokers in Germany and, in addition, offers in the TECH sector a modular technology platform (FTG:CBS) for private and special-purpose banks. FinTech customers can perform all-important technology-based and regulatory processes with FTG:CBS. FinTech Group AG continues to be active in both B2C and B2B in a high-growth market environment, which is characterised by a growing share of online brokerage and an increasing use of technology in the banking world.
Accordingly, over the past fiscal years the company posted a positive performance both in sales and income. In 2017 sales revenue climbed 12.6% to €107.01 m (previous year: €95.02 m). The basis for this is the continuing increase in the number of customers to 253,825 (previous year: 212,040), whereby both more transactions were executed and an expansion of the loan book achieved. On the other hand, the B2B business remained slightly below expectations, though it is expected to link to previous growth by acquiring new customers.
With an EBITDA margin of 30.0% (EBITDA: €32.07 m), FinTech Group AG has a high profitability level. This should further increase in future in the environment of rising sales revenue. Economies of scale in administrative and staff expenses and in securities transactions are important drivers.
For the current fiscal year, the company anticipates sales of €120 m and with it a continuation of the growth dynamics and a significant improvement in EBITDA to €40 m. FinTech Group AG also plans to increase the number of customers in both B2C and B2B and has taken a number of measures to do so. They include the rolling out of new products, planned geographical expansion and the unchanged positioning of the flatex brand as innovation and cost leader.
In our sales and profit forecasts, we follow the company guidance, though we consider it to be somewhat too conservative. In light of what we consider to be good development opportunities of the coming year, FinTech Group AG should be able to earn sustained returns on equity of at least 18.6%. Within a residual income model, we have calculated a fair enterprise value per share of €41.70 (previously: €35.00). The reason for the increase is the first-time consideration of the significantly higher 2019 forecasts as the basis for the calculation of the final value and is thus to be considered as a roll-over effect. In light of a current stock price of €29.40, this means upward potential per share of over 40%. This clearly suggests a BUY rating.
Wichtiger Hinweis:
Bitte beachten Sie den Disclaimer/Risikohinweis sowie die Offenlegung möglicher Interessenskonflikte nach §34b WpHG /FinAnV auf unserer Webseite.
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