TPI provides its latest research note on DeepVerge plc (DVRG.L)

DeepVerge has released a post-31 December 2021 year-end trading update along with a statement detailing its outlook for the current year.

Unaudited figures point to another year of triple-digit percentage growth, taking revenues to £9.33m (2020: £4.48m – audited) on the back of higher margins and an increase in recurring revenues despite supply chain delays and reduced production staff due to COVID infection/isolation in the fourth quarter.

With several substantial 2021 shipments plus a backlog of regular reagent supplies needing to be pushed into Q1 2022, continued expansion of order books across all divisions supported by an exceptionally strong balance sheet provides strong foundations for the current year.

Based on this, the ambitious forecasts and valuation that TPI published back on 3 August 2021 remains unchanged, suggesting a target price for the Group, which presently trades on a lowly 8x 2022 EBITDA multiple, of 94.7p/share.

(Please note that TPI’s valuation is based on financial modelling and there is no guarantee that such a valuation will ever be realised, therefore please do not base investment decisions on this valuation alone. Also please note that past performance is not a reliable indicator of future results.)

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We would draw your attention to the various disclaimers in the document both at the beginning and at the end of the note. Retail clients (as defined by the rules of the FCA) must not rely on the research document. In particular you should note that the research document is a non-independent marketing communication. The analyst who has prepared the research is aware that TPI provides research to DeepVerge plc. Accordingly the research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibitions on dealing ahead of its dissemination.

The information in the document is published solely for information purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The material contained in the document is general information intended for recipients who understand the risks associated with equity investment in smaller companies. It does not constitute a personal recommendation as defined by the FCA or take into account the particular investment objectives, financial situation or needs of individual investors nor provide any indication as to whether an investment, a course of action or the associated risks are suitable for the recipient.

Copyright © 2022 Turner Pope Investments (TPI) Limited, all rights reserved.


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