Shearwater Group (SWG)

Sector:

Mining

Index:

FTSE AIM All-Share

203.00p
   
  • Change Today:
    -2.00p
  • 52 Week High: 292.50p
  • 52 Week Low: 157.50p
  • Currency: UK Pounds
  • Shares Issued: 23.67m
  • Volume: 15,018
  • Market Cap: £48.05m
  • RiskGrade: 492

Berenberg lowers target price on Shearwater despite 'reassuring trading update'

By Iain Gilbert

Date: Monday 30 Mar 2020

LONDON (ShareCast) - (Sharecast News) - Analysts at Berenberg lowered their target price on software provider Shearwater Group from 500.0p to 400.0p on Monday despite the firm's "reassuring trading update" from last week.
The AIM-listed group confirmed that its shift to remote working had not created material disruption to the provision of services to its customers and most importantly, it stated that for the current trading year, it had not yet witnessed any "material impact" on the profitability of its cash flow as a result of the Covid-19 pandemic.

Shearwater added that the recent increase in remote working had actually resulted in SecurEnvoy, 8% of group revenue and roughly 20% of underlying earnings, enjoying increased demand for its multi-factor authentication solutions.

"This has led to a number of new contract wins and existing clients have upgraded their contracts. This heightened demand should help underpin our software division forecasts," said Berenberg.

While Shearwater indicated that it had not yet noticed any material impact on the profitability and did not change its guidance, Berenberg chose to cut its underlying earnings estimates by 25% as it now anticipates some delays to contracts, disruption to utilisation and "a more challenging sales environment" for the coming year.

However, the German bank noted that it does not believe Covid-19 will affect the group's attractive M&A and organic medium- to long-term opportunities.

"While the economic impact of Covid-19 restrictions on economic and social activity have the potential to disrupt SWG's near-term trading, we believe its mid-term equity story remains unaffected," said Berenberg, which also reiterated its 'buy' rating on Shearwater.

"On a medium-term view, we continue to believe in SWG's strategy to consolidate its highly fragmented market which, in conjunction with the robust medium- to long-term secular growth in cyber security, makes us confident that SWG can deliver material growth over the coming years."

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

SWG Market Data

Currency UK Pounds
Share Price 203.00p
Change Today -2.00p
% Change -0.98 %
52 Week High 292.50p
52 Week Low 157.50p
Volume 15,018
Shares Issued 23.67m
Market Cap £48.05m
RiskGrade 492

SWG Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
5.64% below the market average5.64% below the market average5.64% below the market average5.64% below the market average5.64% below the market average
10.34% above the sector average10.34% above the sector average10.34% above the sector average10.34% above the sector average10.34% above the sector average
Price Trend
3.34% above the market average3.34% above the market average3.34% above the market average3.34% above the market average3.34% above the market average
14.75% below the sector average14.75% below the sector average14.75% below the sector average14.75% below the sector average14.75% below the sector average
Income Not Available
Growth
21.42% above the market average21.42% above the market average21.42% above the market average21.42% above the market average21.42% above the market average
31.03% above the sector average31.03% above the sector average31.03% above the sector average31.03% above the sector average31.03% above the sector average

What The Brokers Say

Strong Buy 2
Buy 0
Neutral 0
Sell 0
Strong Sell 0
Total 2
strong_buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

SWG Dividends

No dividends found

Trades for 03-Jul-2020

Time Volume / Share Price
16:12 1,000 @ 200.00p
16:10 1,000 @ 200.00p
16:07 1,000 @ 202.00p
15:59 486 @ 205.50p
15:02 1,000 @ 205.60p

SWG Key Personnel

Chair David Williams
Finance Director Paul McFadden
CEO Phil Higgins

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