MorphoSys, HelloFresh, Aspermont - Price halving or rebound?

Aspermont: Ripe for a price increase in the short and long term

Investors can speculate on a rebound in Aspermont Limited. The share of one of the world's leading providers of business-to-business (B2B) media for the commodities sector has slipped in recent days to the lower end of a sideways movement between AUD 0.022 and AUD 0.032, which has been stable for months. With a continuation of the trend, a good 30% price potential beckons. In the long term, even more, is possible. Thus, the German research house GBC analysts recommend the share of the Australian technology enterprise to the purchase (http://www.more-ir.de/d/22781.pdf). The price target is AUD 0.09. Aspermont publishes subscription-based content services for the mining, energy, agriculture and technology sectors worldwide. In business-to-business marketing, the Company is one of the leading players globally, GBC said. In fiscal 2020, Aspermont successfully completed its turnaround with positive EBITDA, it said. The Company is debt-free and has AUD 7.3 million in cash and cash equivalents.

A new growth phase is now beginning for Aspermont, with 7.4 million contacts and a new lead generation program expected to boost the Company's gross margin and profit, it said. In addition, the current recipe for success should be applied to new areas. On this basis, GBC expects a profitable growth phase to begin in fiscal 2021, with revenue growth of 20% over the next two fiscal years. As a result, revenue would increase from AUD 15.20 million in 2020 to AUD 29.51 million in 2023. With this expected strong revenue momentum and economies of scale developing, gross margin should increase to 60%. EBITDA would then climb from AUD 3.03 million in 2020 to AUD 8.86 million. Based on the DCF model, GBC has published a price target of AUD 0.09 (EUR 0.06) for Aspermont shares. The price potential is thus considerable.

HelloFresh: Analysts lower their thumbs

The outlook for HelloFresh is less optimistic. At least, this is the opinion of the analysts at Bernstein Research, the HelloFresh share with "Underperform". The price target is EUR 51.50, well below the current level of around EUR 90. Analyst William Woods evaluated the past quarterly figures and the customer structure of the cooking box provider. His conclusion: the quality of the customer base is weak and characterized by high churn. He believes that the new DAX member will have a hard time meeting the high expectations. The cooking box provider itself expects significant growth in the coming years. To achieve this, however, it currently has to invest and expand capacity. That comes at the expense of margins. In the second quarter of the current year, this was not yet noticeable. In the three-month period, HelloFresh generated sales of around EUR 1.55 billion (Q2 2020: EUR 972 million), slightly more than analysts expected on average. Adjusted EBITDA was slightly above analysts' estimates of EUR 155 million at EUR 158 million (Q2 2020: EUR 154 million). For the full year 2021, the Company has raised its revenue forecast from 35-45% to 45-55%. Due to the accelerated expansion of production capacities, fulfillment costs in the current year are expected to be higher than initially assumed. Accordingly, the adjusted EBITDA margin for the full year 2021 is likely to be between 8.25% and 10.25%. Originally, 10% to 12% had been planned.

MorphoSys: No sign of a rebound

Investors are waiting in vain for a rebound at MorphoSys. Product sales of the cancer drug Monjuvi are below expectations, and the billion-dollar acquisition of Constellation Pharmaceuticals is weighing on the stock. As a result, the share has developed a clear downward trend in recent months. But even at the current level, Goldman Sachs, for example, sees no upside potential.

The US investment bank has reinstated MorphoSys in its coverage. The share is currently only rated as "Neutral". The price target of EUR 42 is only at the current level. The acquisition of Constellation Pharmaceuticals would strengthen MorphoSys's previously thin research pipeline, provide medium- and long-term sales potential, and reduce the dependence on the hopeful Monjuvi. However, the high acquisition costs would further delay the achievement of profitability.

Investors need to be patient with MorphoSys. HelloFresh has performed very well, and as Bernstein's study shows, the potential for a setback is high. If Aspermont stays in the trend channel, 20% to 30% price gains are possible, perhaps more in the long term.