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WTC, WISETECH GLOBAL LIMITED
nipper
post Posted: Aug 21 2019, 09:35 PM
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Richard White at WiseTech Global continues to perform. His $8.8 billion logistics software company is trading on a multiple of around 113 times earnings, so room for disappointment is non-existent, and after Wednesday’s profit review the stock was trading up 9.9 per cent at $30.46.

The fact is he is continuing to perform, with revenues last year up 57 per cent at $348.3 million and earnings before interest, tax, depreciation and amortisation up 39 per cent at $108.1m.

There is a touch of unreality about an $8.8bn company that reports just $54.1m in earnings.

WiseTech completed 15 acquisitions last year as it continues to expand globally.

The company supplies software that makes trading easier by providing a platform that logistics suppliers can use to map shipping times, border rules and the myriad documentation required to trade goods and services.

The more the world is complicated by Brexit and the US-China trade war, the more valuable is WiseTech’s service.

As White explains: “We are well placed to address the seismic changes coming. Our solution is web-enabled with international fulfilment from origin. It integrates shipping, customs, international freight forwarding, parcel, final mile delivery and full track and trace, delivering real-time visibility for shipper, consignee, retailer and consumer.”

A US launch beckons, but the key is the global platform, which means White actually benefits from industry consolidation.




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
blacksheep
post Posted: Aug 10 2019, 11:34 AM
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In Reply To: nipper's post @ Mar 19 2019, 07:24 PM

Interesting read - WTC gets a mention - https://www.theage.com.au/business/companie...808-p52f3d.html

QUOTE
Wisetech, a logistics software company, is worth as much as Qantas with a $8.5 billion market cap

By way of comparison, Qantas reported revenue totalling $16.6 billion in 2018 and a net profit of $1.14 billion. Wisetech recorded revenue of $221 million and a net profit of $40.8 million.


QUOTE
Montgomery used to hold Altium shares before they got too expensive for his liking and is a big fan of Wisetech.

"Wisetech is a very high quality business ... but it is frighteningly expensive."


Total short positions as at 5/8/19 = 1.92%
https://www.shortman.com.au/stock?q=wtc
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The herd instinct among forecasters makes sheep look like independent thinkers. Edgar Fiedler

If the freedom of speech is taken away then dumb and silent we may be led, like sheep to the slaughter. George Washington
 
nipper
post Posted: Mar 19 2019, 07:24 PM
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WiesTech Global is considering taking an extra $50 million from institutional investors, as part of a raising underway on Tuesday.

Brokers Goldman Sachs and Morgan Stanley sent a message to fund managers, saying WiseTech was considering increasing the placement to $300 million from $250 million.

The change of heart was attributed to a big order from an existing investor....




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Aug 22 2018, 02:30 PM
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In Reply To: nipper's post @ Aug 22 2018, 11:12 AM

WiseTech Global has grown revenue by 44 per cent to $221.6 million for the full-year to June 30, ahead of its earnings guidance.

The 45 per cent jump in earnings before interest, tax, depreciation and amortisation to $78 million was also well ahead of its previous guidance of 32-39 per cent EBITDA growth.

The company also reported a 28 per cent jump in net profit to $40.8 million.

- pushing past $21 ... up some 35%





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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Aug 22 2018, 11:12 AM
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Rise was merely postponed? WTC hitting highs



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Feb 21 2018, 02:07 PM
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WTC announces:
- revenue up 31%
- EBITDA up 32%
- on track for FY18 guidance

So, what do we get? SP down $3.30 or 22%; and no bounce.
The earlier question; What could stop the rise and rise of WTC? ... Looks like the company failed to issue a profit guidance upgrade as part of its half-year results.
QUOTE
RBC Capital Markets: "There appears to be an implicit downgrade to guidance that has occurred, as WTC's guidance ranges have not changed, but now include contributions from additional acquisitions (Microlistics, Intris appear to account for ~$7 million of revenue that wasn't in their AGM guidance). "Given the company's current high trading multiples, we would expect some pressure on the stock following this result."




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 


nipper
post Posted: Feb 18 2018, 10:13 AM
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- this was in the press a while back

What could stop the rise and rise of WiseTech Global?

QUOTE
The rise and rise of WiseTech Global, now capitalised at more than $4 billion, is one of the local market's undeniable tech success stories. The logistics software provider shares listed at $3.35 each in April 2016, and since then have risen more than four times, reaching as high as $16.27 this year before falling back in recent weeks.

But, like many tech companies listed on the Australian Securities Exchange, it is hampered by one frequently-shared problem: a lofty valuation compared to its global peers.

While tech companies used to see a US listing as a goal, now it is more frequently noted that the scarcity premium that is generated simply for being listed on the ASX is reason enough to stay local. In other words, don't bother listing offshore. Increasingly, smaller tech companies have been raising capital locally rather than in the US.

WiseTech co-founder Richard White has expressed concerns about this, in particular at the smaller end of the market, noting on a number of occasions that tech companies need to wait longer before listing and reach a "certain critical mass". In the case of WiseTech, White waited until the business was worth almost $1 billion before listing.

But since listing – and even possibly at listing, according to some investors who now regret their decision to pass on the stock – there's little argument the company has outstripped global peers on valuation, particularly when looked at on a revenue multiple basis.

There's also little argument from any quarter that WiseTech is a good business. The sticky nature of WiseTech's software thanks to the complexities of the logistics industry means it has a high recurring revenue rate, excluding acquisitions, of 99 per cent and a customer attrition rate of less than 1 per cent. This has been consistent for the past five years.

The company's flagship product, CargoWise One, allows multiple users along the freight chain to interact, streamlining their operations for what can be an exceedingly complex process. For example, if someone wants to send an item from Australia to New York, they can use the system to turn an email into a quote, make a booking, and complete the dozens of other steps in the process such as invoicing and dealing with complex customs systems. The idea is that the data is available anywhere and the highly automated system saves money because it means companies do not need as many people involved in the process, or different types of software, to get the job done.

With little criticism of the underlying business, the real question is can the share price continue to rise, and is there anything on the horizon that could dent it?

One notable feature of the stock is that it is tightly held, mainly by White and other staff. As well as making it hard to buy stock, it also means it is almost impossible to short – there's little available stock to borrow, though shorts have spiked from virtually nothing to a tiny 1.25 per cent of the company in the past month, according to shortman.com.au.

White owns a 53 per cent stake, while Fidelity, which bought stock ahead of the IPO, accounts for a further 9.6 per cent of the share register and are the only large institution to hold a substantial stake, though others like Smallco also bought pre-IPO holdings and UBS Global Asset Management bought shares at IPO.

In December, White cashed in on some of the gains, selling 2 per cent or 5.8 million of the company's shares at $12.55 apiece. More shares will be released from escrow on February 21, following the company's half-year results.

Given the size of White's stake (he only sold 1 per cent of his holding in the IPO), it perhaps won't be surprising if he were to sell more. Indeed, some investors are actively pushing for a small sale following each result, pointing out TechnologyOne's Adrian Di Marco has done just that, allowing more liquidity along the way.

But last November – just before he sold some stock – White released a statement to the exchange where he said he would not release any more than 1 or 2 per cent for liquidity, and only upon entry to the S&P/ASX 200. He also said WiseTech had no intention of issuing new share capital for liquidity, and would only issue small amounts of stock in relation to employee share plans.

In addition to its high margins and sticky business, another notable feature of the WiseTech model is its frequent acquisitions. In December last year, it notched up its ninth acquisition for the year and this month it acquired Belgian logistics solutions provider Intris for about $17.4 million.

According to the 2018 report from Software Equity Group, which tracks public companies that offer solutions via the cloud and through a subscription of transaction-based pricing model, last year WiseTech bought more companies in the software-as-a-service (SaaS) space than any of its peers, including Oracle, Cisco and Venture Equity Partners.

At first glance, the strategy of bolting on so many businesses looks questionable. But supporters of the stock argue that it's a clever way to expand into new markets. WiseTech can pick up businesses for a low revenue multiple, and then roll out their product to the customers, which not only tend to be open to the idea of change (the pay as you go model may partially help) but more significantly, tend to use the platform frequently. In addition, the founders of the businesses have also been known to stick around beyond the earn-out period, which investors say it another tick in the box for the company's operations and culture.

White has said before: ​"We've spent a long time building an M&A process that scales nicely and runs as a machine. "I don't believe it's in the shareholders' interest for a big acquisition. I also don't believe in bolt-ons. We're buying companies in markets where we strategically expand into."We don't get pushed off mission or distracted by shiny object syndrome."

At the time of the $40 million purchase of Microlistics, WiseTech's ninth acquisition for 2017, White said WiseTech still employed most of the founders from its acquisitions over the years, with one of its first – dating to 1996 – retiring only last year.

In a note last year, Credit Suisse said these slower growth legacy platforms now account for about 25 per cent of WiseTech's overall revenue, and that the group has paid a blended trailing revenue multiple of about three times for its acquisitions over the last 18 months.

Credit Suisse analysts note that in the US the software-as-a-service ("SaaS") sector trades, on average, at about six times one-year forward revenue. Contrast that to the three largest listed SaaS businesses in Australia and their equivalent multiples: Xero (nine times), WiseTech Global (17 times) and Aconex (eight times at the Oracle bid price).

The key risk – which is almost the hardest to predict – is whether WiseTech can keep pace with the changing industry and technology. So far, there's little signs of a threat on that front.

White refers to his software engineers as "artists" and a red electric guitar, the Gibson ES-335, has been hung on the wall of the company's boardroom. White, who played in bands in his younger years, went on to repair instruments for some of Australia's best-known rock bands. He also built a lighting system for a Midnight Oil tour and after investing in an electronics company he worked at until the mid-1980s, White created and later sold a computer wholesaling business called Clear Group.

​Investors are hoping that as long as White keeps his routine — which apparently includes the odd morning walk along Qantas Drive near the Sydney office — focused on the company, and with such a large stake he has plenty of reason too, that's not something to worry about.​
Read more: http://www.afr.com/business/due-diligence-...e#ixzz57PjU2Z3C



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Dec 13 2017, 09:15 PM
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WiseTech Global has just made its ninth acquisition for 2017 – none of which had the "for sale" sign out.

The $40 million purchase of Microlistics, a provider of warehouse management software, was typical of WiseTech's other acquisitions - its founders are now on a multi-year earn-out and that the $3 billion ASX-listed company made the approach.

"We get offered something by investment banks or other vendors every week, and we've never bought any of them – they're not the sorts of companies we'd want to buy," WiseTech founder and chief executive Richard White told The Australian Financial Review.

He said the company had its own list of about 100 potential acquisitions, and favoured companies with longstanding founders whose businesses it could understand.

"They're never for sale when we go to speak to them, but when we talk to them about our ambition to be the operating system for global logistics, they want to be part of it," he said.

"Money is a factor but it's never been just a transaction – we want to bring hearts and minds with us."

Microlistics shareholders, including Mark Dawson who founded the company in Australia in 1994 before taking it global, will receive $20 million upfront and then go on an earn-out whose condition extend to 2019-20 for the rest.

The hurdles for WiseTech's earn-outs were never based on profit or revenue targets, said Mr White, but on project implementations.

"We actually want our founders to get their earn-out every time, because they are built around both parties getting what they expected from the deal," he said.

"That's not always the case where earn-outs are designed more as a bridge between the founder and acquirer."

WiseTech still employed most of the founders from its acquisitions over the years, Mr White said, with one of its first – dating to 1996 – retiring only last year.

WiseTech's 2017 acquisitions have included providers of customs clearance software in non-English-speaking countries, such as Brazil's BySoft, which WiseTech considers "footholds" into territories that might otherwise take a decade to develop organically.

The company is also buying up "adjacencies" to its core logistics software platform, CargoWise 1, such as land transport and cold storage providers.

WiseTech's shares closed up 1.8 per cent to $12.90 on Tuesday, up 23¢. Its share price has more than doubled this year. Earlier this month it was admitted to the S&P ASX200 index

Read more: http://www.afr.com/technology/wisetech-glo...-h03qfe#ixzz518




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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
nipper
post Posted: Nov 22 2017, 08:50 PM
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In Reply To: jacsar's post @ Nov 22 2017, 08:37 PM

indeed - first post was 14 Jul, when it was mid-$6's. I didn't think it would go so well



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne
 
jacsar
post Posted: Nov 22 2017, 08:37 PM
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In Reply To: nipper's post @ Nov 22 2017, 08:33 PM

well spotted...well north of $12; and has doubled since it was half the price...lol

 
 


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