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  • Writer's pictureMark Watson-Mitchell

Amino Technologies – really getting tuned in now, the programme is so right and so are its shares

Recently Amino Technologies (LON:AMO) declared its Trading Update for the year to end November.

It was a very positive statement which showed the £92m capitalised group reporting a resilient performance for the period, during which it had been driving its software revenues and securing new customers.

Software makes up some 26% of total sales, of which over 51% is annual recurring revenue (and that is growing steadily).

An international market-leading ‘Media Tech’ business

Amino is a software-led global ‘Media Tech’ company that delivers modern TV experiences – in just the way that it states that its viewers want.

Although it has its UK headquarters in Cambridge, the company has a total of 300 staff located in offices in New York, Los Angeles, San Francisco, Amsterdam, Helsinki, Madrid, Porto, Brno and Hong Kong.

Just what viewers want

It creates the media and broadcast technology that delivers traditional and modern viewing to all audiences’ screens, thereby enabling traditional TV and contemporary streaming services to be watched on any device, live or on demand.

The group has two operating companies – 24i and Amino.

Focussing on streaming video experiences, 24i offers a robust technology platform that streams TV and video programming to any type of screen. This company has a 10-year market-leading position and works with customers like NPO, KPN, Delta and Broadway HD.

Amino, which seamlessly connects Pay-TV to streaming services, provides the features required in a multiscreen entertainment world. This company has a 20-year heritage with customers like PCCW, Cincinnati Bell, T-Mobile.NL and Entel.

Totally complementary businesses

The two totally complementary companies combine their products and services to create an industry-leading end-to-end offering that helps to ensure that its viewers get their TV programmes how and when they want it.

The group’s solutions deliver modern TV and video experiences every day to millions of viewers globally, via its growing global customer base of over 500 service providers in over 100 different countries.

Tight capital structure

There are 76,048,513 shares in issue.

The larger shareholders include Kestrel Partners (21.08%), Milton Asset Management (17.8%), Investec Wealth & Investment (9.0%), M&G Investment Management (7.5%), Close Brothers Asset Management (4.6%), 24i Media PF (4.2%) and Ari Charles Zaphiriou-Zarifi (3.2%).

Disappointingly, the Directors hold less than 1% of the equity.

Strong trading, revenues and cash

Yesterday’s Update which showed both strong trading and revenue, together with its $9.4m cash strength, led to analysts at its brokers, finnCap, coming out with estimates of the 2019/2020 revenue at $83m ($77.2m) and adjusted pre-tax profit of $10.1m ($9.4m), generating earnings of 11.5p (10.8p) per share and easily covering a 2.8p (1.7p) dividend.

For the next two years they go for $83.2m then £87.5m in revenues for 2021 and 2022 respectively. That would project profits of $11.9m then $13.8m for the two years, with earnings of 13.5p then 15.5p per share and dividends of 4p then 5.9p.

Market-leading technologies demand a far higher rating

Considering that the group’s shares, which were up to 155p in early June, are trading at only 119p today, they look to me to be a really cracking play on the advancement of their market-leading technologies.

I now put the shares of Amino Technologies out on an easily attainable Target Price of 155p.

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