Westpay: Delays, but the potential remains the same

Research Update

2018-10-04

07:30

Just like we expected we saw a small sales drop during Q2’18. Announcements regarding larger orders have been scarce the last months; a major product revamps that Westpay has been working on is the likely explanation for the hesitant customer behavior. The revenue ramp-up from international markets is also delayed, we now model increasing volumes during H1’19. We expect to see a temporary decrease in card terminal volumes during the coming quarter; this will affect the profitability and sales level negatively. The trajectory is never linear for a small growth company like Westpay, and there will be hick-ups along the road. We have adjusted our projections downwards which also leads to a lower Base-case. However, our Valuation range remains almost intact as we believe the long-term potential has not been altered despite the delays and quarterly fluctuations.

KL

Kristoffer Lindström

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