IRE – Morgans rates the stock as Add

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The company has won a contract with Emergency Services and State Super to provide a full back-office service. Morgans observes a shift from being a software supplier to a full service provider significantly expands the company’s revenue opportunity.

Morgans revises forecasts to incorporate licence revenues from ESSS from FY21. The broker assumes 40% of licence revenues are converted into operating earnings (EBITDA).

Add rating maintained. Target rises to $15.33 from $15.00.

Sector: Software & Services.

Target price is $15.33.Current Price is $12.18. Difference: $3.15 – (brackets indicate current price is over target). If IRE meets the Morgans target it will return approximately 21% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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