TeamViewer, Aspermont, TUI - Three turnaround candidates in check

TeamViewer - Is Corona helping again?

How did a winner of the Corona Crisis become a turnaround candidate? CEO Oliver Steil blames "homemade mistakes". At the beginning of the Corona pandemic, TeamViewer, the specialist for remote maintenance and video conferencing, had taken off. Due to the many home office jobs, remote maintenance and video conferencing were necessary, and the Company profited from this. TeamViewer wanted to secure the next future growth area, augmented reality, by acquiring Ubimax. The price seemed too high to experts, and the stock began to fall. But management wanted to raise its profile further and joined Manchester United as a shirt sponsor, which is rumored to cost around EUR 50 million per season.

A profit warning followed at the beginning of October, and the share's slide accelerated once again. On November 3, the Company presented its figures for the third quarter. Sales increased by 9% YOY to EUR 127.7 million after adjusting for currency effects. EBITDA decreased by 27% to EUR 42.3 million, mainly due to the jersey sponsorship contract. The number of subscribers rose to 628,000, and the Company grew in the key account business in particular. The consolidated result was around EUR 3.7 million. If one compares the result with the previous year, when more than EUR 32 million was generated, investors' disappointment is understandable.

However, the current ever-increasing incidences could increase sales again if the home office obligation is reintroduced. In addition, at its Capital Markets Day on November 10, the Company tried to convince investors that it had learned from its mistakes and presented a 10-point plan called Remax, which is to be implemented by the end of the third quarter of 2022 and bring optimizations in five areas. The plan failed to convince investors, and the share fell but did not mark a new low for the year, which lies at EUR 12.46. With a closing price above EUR 15.15, the share could form a first slight upward trend.

Aspermont - A good year-end result

If any industry is suffering from ongoing digitization and the Internet, it is the print media sector. Circulation has been declining almost everywhere for years. Aspermont owns the brand rights to magazines that can look back on a history of up to 185 years. Circulation dropped there, too, and so began the transformation into the leading media service provider for the global commodities industry. Readers can access online content with subscriptions. The Company has also significantly expanded its business areas in the B2B sector. Content marketing is offered for companies with on- and offline trade shows, research and analysis. Most recently, two online projects were announced; one on sustainability, which is becoming increasingly crucial for the mining sector and has already gone live. The other is a platform for raising capital, scheduled to launch in the second quarter of 2022.

On November 3, the Company presented its fourth-quarter figures. The fiscal year ended September 30, 2021, and the transformation is bearing more and more fruit, which can be seen well in the quarterly figures. The first quarter was still weaker than in 2020, but since then, there has been growth. 2% in the second quarter, 11% in the third, and the fourth quarter increased by 24%. Revenue was AUD 4.3 million, and profit was AUD 2.8 million, an increase of 39%. The margin was a substantial 65% and also increased by 12% YOY. The Company was also able to announce that a live trade show is planned for the second quarter.

Growth rates are now above pre-pandemic levels. Subscription numbers again grew by over 20%. All other lines of business also grew. Chief executive Alex Kent said in the wake of the figures, "..., and with the resumption of live events next March, we expect growth to be above average in the next fiscal year." The stock has not reacted at all to the positive news. Since October 18, the share has traded between AUD 0.02 and AUD 0.022. Chart-wise, the share becomes interesting with the break of the downtrend line. If a closing price above AUD 0.0222 succeeds, the trend line would be broken, initiating a breakout.

TUI - Corona brings new worry lines

TUI has suffered immensely from the Corona pandemic. While it looked for a short time as if the business outlook would improve, dark clouds are now gathering again. The Foreign Office advises against all cruises and journeys with Mein Schiff had to be canceled. The incidences in Austria are now exploding, which could again cause cancellations in the upcoming winter season. Already last year, the winter season was almost a total failure for the Company.

At the same time, things seemed to be slowly looking up due to the vaccinations and the second capital increase in October of this year. Major shareholder Mordashov fully subscribed to the capital increase and held about 33% of the shares. The USA has allowed travel from Europe again since November 8. It is questionable whether this will continue if the incidences continue to rise. Every flare-up of the pandemic causes problems in the tourism industry.

The share has therefore fallen again for a few days. Chart-wise, there is currently a shoulder-head-shoulder formation. If the share does not fall below EUR 2.61 on a closing price basis, a test of the EUR 3.00 mark is likely. Analysts currently take a critical view of the stock. 14 of 21 analysts have the stock at Sell, and only two see TUI as a Buy. The Company can only hope that the incidences do not climb further. Better yet, they fall quickly, but it does not look like that will happen at the moment.

All three companies are turnaround candidates. TeamViewer benefits from Corona, but its earnings are burdened due to wrong decisions. TUI is weakening due to the pandemic. The commodities sector is also affected by Corona, but it does not affect Aspermont as much. Aspermont's numbers are improving, and the turnaround seems to have succeeded, even if the share has not yet taken off.