Smartbroker Holding AG
Original-Research: SMARTBROKER Holding AG (von NuWays AG): BUY

Original-Research: SMARTBROKER Holding AG – from NuWays AG

Classification of NuWays AG to SMARTBROKER Holding AG

Company Name: SMARTBROKER Holding AG
ISIN: DE000A2GS609

Reason for the research: Update
Recommendation: BUY
from: 23.02.2024
Target price: 9.50
Target price on sight of: 12 Monaten
Last rating change:
Analyst: Frederik Jarchow

Mixed FY23 prelims // transition year ahead; chg

Topic: Yesterday, Smartbroker Holding reported FY23 prelims that came in as
a mixed bag as well as a conservative outlook into FY24 that is underlined
by soft monthly trading stats. In detail:

FY23 sales of € 46.3m (-12% yoy) are 8% below our estimates of € 50.4m,
driven by both, weaker Media sales of only € 28.1m (-18% yoy vs eNuW: €
29.4m) and weaker Transaction sales of only € 18.2m (-3% yoy vs eNuW: €
21.0m). While Media suffered from the difficult market environment with
lower volatility, weakness in Transactions resulted mainly from the
negative side effects of the migration to S+ visible in declined no of
customers and trades.

EBITDA came in at € 0.5m (-94% yoy), in line with estimates (eNuW: € 0.3m).
Lower than expected marketing spending (-65% yoy to € 1.6m vs eNuW: € 3.5m)
and other operating expenses (-2% yoy to € 7.8m vs eNuW: € 8.2m),
compensated for the softer topline. As D&A stand at € 6.4m (vs eNuW: €
3.4m), EBIT came in at € -5.8m (vs FY22: € -8.4m), significantly below our
estimates (eNuW: € -3.1m).

In a nutshell, the preliminary figures are the reflection of a difficult
year, burdened by the weak stock market performance and the migration to
S+. Still, prelims were in line with the reduced guidance from September
2023 (€ 46-51m sales; € -1 to 1m EBITDA).

Looking into 2024, we rather see a transition year that should be
characterized by the launch of several missing features at S+ (such as RFQ
orders at all trading venues or bond trading) and the UI/UX overhaul of
several portals in the Media segment. Positively, the product improvements
paired with increasing marketing spending from H2 onwards, should fuel
topline again resulting in € 50.0m sales and € 1.6m EBITDA (eNuW), in line
with management guidance of € 50-55m sales and € -1m to € 3m EBITDA.

Overall, the S+ remains the growth driver of the Group, as the unique
combination of the service range of an established full-service broker at a
neobroker pricing should drive customer inflows and transactions, fueled by
reach of the proprietary media portals.

As the investment case remains intact, we reiterate BUY with a reduced PT
of € 9.50, based on DCF.

You can download the research here:
http://www.more-ir.de/d/28967.pdf
For additional information visit our website
www.nuways-ag.com/research.

Contact for questions
Die Analyse oder weiterführende Informationen zu dieser können Sie hier downloaden
www.nuways-ag.com/research.
Kontakt für Rückfragen
NuWays AG – Equity Research
Web: www.nuways-ag.com
Email: research@nuways-ag.com
LinkedIn: https://www.linkedin.com/company/nuwaysag
Adresse: Mittelweg 16-17, 20148 Hamburg, Germany
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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben analysierten Unternehmen befinden sich in der vollständigen Analyse.
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——————-transmitted by EQS Group AG.——————-


The issuer is solely responsible for the content of this research.
The result of this research does not constitute investment advice
or an invitation to conclude certain stock exchange transactions.