Altium ((ALU)) did everything right in the first half, expanding its subscription base, garnering strong sales and sustaining price improvements. After a very strong result the question is where to next?
Altium (ASX: ALU) is one of Australia’s most successful software businesses. Over the last five years, the company has grown rapidly, and its stock price has soared more than 10-fold. ALU’s FY17 result shows a business going from strength to strength. But is it a tad expensive at these prices?
Just because a company’s share price rises strongly doesn’t mean it no longer represents ‘good value’. It could still be ‘cheap’ if its value outstrips its share price rise. Take Altium (ASX:ALU), for example, which just reported exceptional results for FY16, and forecast a very rosy FY17. Altium’s share price rocketed to an all-time high, but we think the company might still be one of the best value propositions on the ASX.
We are pleased to report on another great result out of Altium Limited (ASX: ALU). We met with CEO Aram Mirkazemi, Martin Ive (VP Finance), Kim Besharati (VP IR) and Henry Potts (VP Enterprise Solutions, otherwise known in the industry as ‘Mr PCB’) on Thursday for a discussion on the firm’s results and future prospects.
Further to our recent blog post on Altium Limited (ASX:ALU), Altium has today announced that it has signed an OEM agreement with Dassault Systèmes to introduce a new SOLIDWORKS Electronic Computer – Aided Design (ECAD) product based on Altium’s Printed Circuit Board (PCB) software technology.
Altium’s result beat on the critical revenue line, exceeding the company’s target. Sales and subscriber growth and renewals continued to improve, the broker notes, reflecting a stronger organic growth profile.
The broker has taken on board investor belief that at 22.4x forward earnings, Altium is overvalued. Not wishing to look at PEs in isolation, the broker looked at a range of comparative metrics and has decided the company is strong relative to other ASX listings on growth, risk and quality.