I'm guessing that could relate to acquisition of Church Community Builder customers...
Printable View
Forsythbarr updated today 05.11.2020.
"We update our blended DCF multiple valuation approach rolled forward at the cost of equity, lowering our target price fromNZ$13.85 to NZ$11.44. We decrease our terminal market share from 20% to 15% and our sales forecasts for FY22 are decreasedfrom 15% to 13%. While US peers imply a multiple of 8.0x EV/Sales, Australian Technology peers imply an EV/Sales of 12.4x."
I saw some signal of buying now after few months follow the stock!
I have the same query.
The March 2020 Annual report has 10,896 customers.
None of this makes sense. How can you have exactly the same number of customers 6 months later?
Maybe one of us should write to them and ask.
UPDATE - I am writing to PPH to ask
I thought there was an upcoming webinar which would be a good opportunity to query the numbers
https://irssl.q4europe.com/IR/Files/...esentation.pdf
There's a post on HC courtesy of user SteveSage re customer numbers for past 4 years which may help shed some light on that front...
*****
If I go back to the presentations over the last 2 years:
- 2018 Annual results (published May 2018) customer number reported is 7,276
- 2019 Interim results (published Nov 2018) customer number reported is 7,420
- 2019 Annual results (published May 2019) customer number reported is 7,649
- 2020 Interim results (published Nov 2019) customer number reported is 7,905
- 2020 Annual report (published May 2019) customer number reported is 8,180 (includes 1,442 mutual customer, excludes 2,716 CCB only customer making up a total of 10,896 customers)
- 2021 Interim results (published Nov 2020) customer number reported is 8,489 (no change to total customers, but mutual customers at 1,829 & CCB only customers at 2,407 if I've done the calcs correct)
Which means customer additions
1H19 (Mar18-Sep18) = 144
2H19 (Sep18-Mar19) = 229
1H20 (Mar19-Sep19) = 256
2H20 (Sep19-Mar20) = 275
1H21 (Mar20-Sep20) = 309
So I stand corrected on the customer numbers (sorry not sure how I got 500....prob looking at 12mths growth).....and yes this half they have grown customer numbers more than they have in the last 5 halves so quite impressive.
*****
This is the reply from PPH. Their investor relations are amazing!
“ To clarify, the reference on page five is comparing the total Customer number as at 30 September 2020 and 30 September 2019. Pushpay increased its Customer base over the 12 months ended 30 September 2020, from 7,905 to 10,896 Customers.
The reference on slide 41 reflects that during the six month period of 31 March 2020 – 30 September 2020, the total Customer number remained flat.
We included the detail in this slide to provide more clarity into our flat Customer number by showing the growth in the two product holdings that the Company offers over the last six months. While Pushpay grew its product holdings over the last six months, the net total Customer number remained flat when factoring in other drivers such as churn and cross-selling products to existing Customers.
Please feel free to let us know if you have any other questions.
Thanks!
Kind regards,
Gabrielle”
I still find it astonishing the number is exactly the same! I have written with further questions so I will update you when I get a response
Big thanks to sb9 and Tango for the clarification on customer numbers. Appreciated.
You make an interesting point. Ogg has been ramping SKT and other forums remove posts with ramping. I wasn’t concerned because I know it’s all speculation but I can imagine new investors might get caught up in the M&A speculation. Sharesies buyers have been watching the thread and the theories
I think/hope Ogg bought into SKT in circa 2014 at $3+ and is down 95% today but still suffering from sunk cost fallacy
USA Covid cases are likely to increase even more over their winter and are currently growing/spreading at 100,000 new cases per week! See it here.
Much to early to say what the effect on PPH is, or is going to be.
(Disc - don't hold but watching)
Totally agree with the sharemarket being emotional. That's why I'm watching this one.
Share split coming up and market not reading it right = opportunities.
(As to Covid, there is likely to be many months of hardship ahead for the USA so FY20 and FY21 will be v interesting.) As I say, I don't hold, but am always looking.
Forsythbarr updated today 11.11.2020.
"We downgrade Pushpay (PPH) to NEUTRAL from OUTPERFORM following its 1H21 result and subsequent Investor Day. Wepreviously took the view that the market was underestimating the growth opportunity in regards to penetration of large USmegachurches, with the company estimating a 25% market share in July 2020. However, it has become clear that penetrationof US megachurches is now saturated and we cite increasing uncertainty over PPH's front book in view of its shifting focustowards smaller churches and the Catholic market — segments which the company has previously downplayed. In addition,PPH competitors Tithely and Givelify have seen net customer increases of up to +6,000 and +18,000 churches respectivelyover the past six month period, in comparison to PPH's net additions of medium/large churches by +13 and small churches by+296 on its donor management platform. Given clear competitor outperformance in this key growth segment, PPH's ability tomeet our previous growth assumptions appears compromised, and we reduce our FY22 sales growth rate from 13% to 10%."
"Target price: Reduced from NZ$11.44 to NZ$9.25 due to a lower FY22 sales growth rate and longer term growth assumptions". It is similar to the valuation of Jarden now.
Very interesting to watch this stock until share split.
More info from PPH investor relations to my queries.
My question:
On page 21 the Church Disrupt event in May 2020 refers to attendance by "7,300+ unique churches across 40+countries" and "Attendance: 75% prospects, 25% customers". The flat customer numbers would suggest that your sales efforts did not convert any prospects to customers from that conference. Can you please explain the relevance of this slide and confirm my understanding?
Response from PPH
This latest report seems like a lot of smoke and mirrors. Having said that the churches have a huge addressable market, I like the proposed integrations including clipping the ticket on alumni contributions. I know the previous CEO had ideas of using this app more widely and the current management have focused only on the churches. I guess the point I am coming to is where is growth going to come from?Quote:
We have not provided detail around conversions from Church Disrupt to the market however online events held over the year typically generate revenue opportunities including attracting new customers over time.
We highlighted Church Disrupt in the Interim Results to demonstrate the significant reach and attendance that our inaugural digital conference saw at a time when pivoting to digital is more important than ever.
Add into the equation that Biden is considering mandating a lockdown. Let the rioting begin...
Lol, Biden will not have any right to order the country to be lockdown until next Jan 20.
the SP needs a bid of Godly intervention & assistance with the upcoming Share Split ;)
What was Tim Hunter on about re Push in the NBR
Headline seemed negative
Was a bit...
History P/E of 155, insiders selling, head of the audit committee quitting without explanation, no customer growth between July and September only cross selling and increasing competition from the likes of tithe.ly. Definitely don't look at their product comparison page.
That’s what I’m waiting for BUT the previous management wanted to use the software for other giving. PPH is very focused on the church sector. Church school alumni may be included, which would be exciting, but I would love to see this software adapted for other gifting and donation programs
Keen to hear people's views on what we can expect post shares split next week?
I'm trying to decide on an entry point i.e. before or after the split.
Post-split, people sometimes (incorrectly?) assume that there's value because of the lower price (especially those that don't understand how share splits work - thinking of mom and pop Sharesies investors).
Thoughts?
What effect if any will this have on the share price? .... https://www.nzx.com/announcements/363572
Does a sp of $8 become $2 afterwards? But I have 4x as many shares?
You will have 4x as many shares, this is correct. The price of these new shares will be decided by the market (as usual), but as a starting point your assumption might be correct.
I guess the board hopes for the market to see the new PPH shares as "cheap" and to drive the price back towards the "old" share price. Sometimes this strategy works after a share split and sometimes it does not.
I dont get the point of a share split. Do they really believe they are out of reach of most investors at $7-$10 per share? surely not. And exactly to your point, it gets back to $7-$10 some point in the future, then what, another share split?
That shouldn't matter much though as they can buy fractions too...
Does anyone know how the new price will be calculated for Wed? Will it be the closing price Tues 4pm ÷ 4 or some sort of rolling average price ÷ 4?
why are they holding trade this morning ?
When it goes back up to $8, the market cap will only be about $8 billion. Cheap as chips :)
(I still hold some but sold most when the insiders started selling; think it's probably overvalued at current prices, but am holding some just in case in keeps growing!)
Up about 10% since the split. It works!
Great to see this stock moving up! Getting close to my break even point....
Absolutely! Much better to see the Bible belt dwellers feeding their faith industry (and PPH clipping the ticket) instead of throwing their money at the loser in the WH.
On a second thought - Shouldn't PPH offer their services for pseudo religious political donations as well?
I hear Trump collected over the last 4 weeks more than $200m from his flock. Would be nice to see PPH get a cut from that money as well, wouldn't it?
Food for thought.
PPH Quietly keeps chugging along.............nice
Trump collecting 200m you say BP that's a disgusting amount..............what can possibly go wrong with American Presidential selections
Back in August I wrote the above when PPH was trading at around $1.93/share (adjusted for the share split). Price today is around $1.89/share. So i'm starting to wonder whether this is a plateau or a peak. Therefore, thought it was worth revisiting the above comments, adding some updated views and getting others' input on where the business sits today.
Probably worth noting that in the interim I haven't done anything with my shareholding - no particular rhyme or reason to that, but my general investment approach is tilted more towards value investing than trading - that's not really a suggestion that one is better than the other, I just don't really have the time or "skill" to pick the ups and downs with any real accuracy, hence I'm biased towards picking good companies, with good management that I can afford to not monitor on a daily/weekly basis. At times I do worry this is a bit dangerous as I do think investors need to digest and respond to market and company changes as they arise, but as noted, I try and "protect" myself from being reactionary by buying companies that don't require significant oversight.
That said, you make money two ways - when you buy and when you sell. I'm better at buying than selling but paper gains are just that... on paper. Anyway, onto my views on PPH and apologies in advance for the lengthy post.
Digesting the most recent broker reports and company announcements
- Starting with ForBarr (which was the catalyst for the above post given their $3.10/share recommendation (again, adjusted for the split))
- On the 11th of Nov FB downgraded their recommendation mainly on the basis that "[FB] previously took the view that the market was underestimating the growth opportunity in regards to penetration of large US megachurches, with the company estimating a 25% market share in July 2020. However, it has become clear that penetration of US megachurches is now saturated and we cite increasing uncertainty over PPH's front book in view of its shifting focus towards smaller churches and the Catholic market — segments which the company has previously downplayed. In addition, PPH competitors Tithely and Givelify have seen net customer increases of up to +6,000 and +18,000 churches respectively over the past six month period, in comparison to PPH's net additions of medium/large churches by +13 and small churches by +296 on its donor management platform. Given clear competitor outperformance in this key growth segment, PPH's ability to meet our previous growth assumptions appears compromised, and we reduce our FY22 sales growth rate from 13% to 10%"
- FB effectively reduced their target to $2.31 - a material ~35% reduction suggesting a slightly over-exuberant initiation of coverage.
- Both Macquarie and UBS sit neutral, with Macquarie downgrading on the 5th of November
Reflecting on the above
- I think the incremental market share gains are going to be more expensive, harder and less profitable. Medium churches are valuable but the CAC and LTV are higher and lower respectively
- I ascribe a higher value to organic growth than acquisition growth. Why? Mainly because acquisitions are expensive... not necessarily due to the price paid, but rather the cost of integration and distraction. The likely focus on acquisition growth is ok, but nerve racking
- Competition is real - according to FB's interviews, "We started using PPH 4–5 years ago. It has been great, but we're switching away as don't need all the capabilities. We're now doing full-on digital and have switched to Simple Donation. We were on a PPH contract on a monthly deal, but they have increased the rate so we went to explore other options as we weren't using all the different functions and didn't need it all"
- Transition of medium churches to large/mega appears challenging - how many medium churches really become mega churches? And even if they do, is it 1-2 a year?
- What is the opportunity outside of the US? I do worry that PPH's global market is really only the US market and with ~10% share, the growth opportunity is limited. Broader question, what's your view on whether PPH has any ability to service other denominations? With Christianity the game is clipping the ticket on donations/tithing. Does PPH have an ability to provide other religions a service they're willing to pay for? Are there other markets worth exploring?
- Digital penetration has been accelerated through Covid - but are we now back to slow and steady digital penetration from here? And is that tempered by the reducing number of church goers?
- Does the frequency and size of the insider sell downs now start to look worrying as opposed to rational?
Addressing the comments in my last post
- Above in red.
- Time to fight the quandary that is, "where do I put the modest gains?" and take my own advice of making some cash gains on selling.
- TL;DR (too long; didn't read) - I'm a seller (risky, but going to give it a week and see if anyone can convince me otherwise)
Sir Ten..I enjoyed reading your constructed post :)
"PPH has requested the trading halt to facilitate a bookbuild for the sale of a significant combined shareholding in PPH by two existing shareholders."
https://www.nzx.com/announcements/365006
Be interesting to see what price it goes through at. I have a feeling it could get pretty punished once market reopens.
from raskmedia.com.au
Pushpay said that the sell down will provide further free float and liquidity and is undewritten at a floor price of NZ$1.75 per share. This represents a 9.3% discount to the 5-day average price of NZ$1.93 per share, and a discount of 7.4% to the last closing price of NZ$1.89.
An indemnified underwrite whatever the hell that is?? Any ideas?
Unequally sharing in the cost or conditions before the indemnity is triggered (ie. underwriter has to hold, not dump??)
Nope ,but Craigs are involved. I declined the offer.
Looking at the recent A2 drama and insiders selling out massively, is a downgrade coming soon for PPH? Even their AGM statements about COVID are very similar ;)
I thought it was very clever how these chaps did the share split and then the sell down ...
Here’s hoping PPH starts a recovery, having nearly as much in PPH as I do in A2, my portfolio hasn’t been looking very healthy. At least my outlook for PPH is looking up :-)
Mine were free held when I sold out at $9.50
Normally I don't impulse buy but I got caught up in the hype and FOMO'd back in. Won't do that again. I don't know where my head was
The only good news with the sell downs is that it was oversubscribed so obviously the instos like it.
Does this horse have any life to it or is it turning to slow drifting wood?
If you want a recent example of management buying, take a look at CHK on the ASX.
Executive chairman Mordechai Benedikt has been buying on market in the past week, moving him on to the substantial shareholder list with more than 5% of stock.
Benedikt spent $381k in the past week to pick up more shares after having already spent $461k in December. That's a decent vote of confidence in where the company is going.
(now I've probably just jinxed it, and the shareprice will likely collapse; but I did put some money from my 'spec account' into the CHKOA options last week.)
Well done holders. This is definitely one share I should have remembered the phrase "let your winners run". Great to see them doing well, announcing a new CEO and issuing a profit upgrade:
https://files.q4europe.com/ClientAdm...date%20and.pdf
https://files.q4europe.com/ClientAdm...as%20Chief.pdf
Yes on the right track
Previous guidance for the year ending 31 March 2021 - EBITDAF of between US$54.0 million and US$58.0 million
Updated guidance for the year ending 31 March 2021 - EBITDAF of between US$56.0 million and US$60.0 million
What am I missing here? 4 profit upgrades so far and the share price is now trading at a 8 month low? Is the market awaiting a profit downgrade before pushing the share price higher? Odd
I think credibility of the insiders is shot. Added to the continual selling, the reason for the share split (that is adds value) is nonsense. It doesn't.
Mmmm not quite right Grenz..... the major reason for the current low SP was the recent 4:1 share split. Details here. Four times more shares = a lower unit SP.
Voted one of the best companies to work for in Seattle.... https://finance.yahoo.com/news/built...145100444.html
This audio interview from November 2020 features Molly Matthews, the Chief Customer Officer for Pushpay. Molly inspires us with her story about growing within the start-up of Pushpay, and what motivates her to lead a team in today's world.
https://theseattlesheeo.buzzsprout.com/1343965/6543910
11,000,000 shares just crossed off market at 158 .
Institution buying?
Sellers are going to cry when PushPay pick up the business for the 70 million catholics in the US
There is definitely accumulation going on. Would be interested to know who's buying at such volume, would have to be institutional buyer I would think. Rumor has it that an entire new segment/geography has come onboard, but I don't know any more than that.