Technology
Not only is SSNC trading well below precedent transactions and publicly traded comps, but with its proprietary AI technology its valuation also represents a sizeable discount to most of the other companies that are already capitalising on the AI megatrend. Boyar is also attracted to the firm’s significant recurring revenues, high margins, leading position in its field, less exposure to China, material inside ownership and strong FCF. They believe the earnings slowdown of 2022 and 2023 was a temporary lull in a longer-term growth story and therefore find the current valuation very compelling. Boyar’s intrinsic value estimate of $112 per share, offers ~80% upside.
Edition: 190
- 12 July, 2024
Technology
This defensive compounder offers compelling risk reward - trades at 11x EPS yet has grown EPS at a 25% CAGR for the last decade. With highly predictable earnings, SSNC is relatively well positioned into an economic downturn. Investors shouldn't focus on organic growth, earnings is driven by acquisitions and now is an opportune time with more targets available and at better prices than they have been for ages. TP $85, offers 50% upside, while Abacus Research's bearish scenario sees downside risk of only 12%.
Edition: 139
- 08 July, 2022