Globo: Is 2013 to be the year of real progress in Globo's share price?

Friday, Dec 28 2012 by
3

I have bought a small holding (1.5% of JIC portfolio) of Globo (LON:GBO) this morning. Globo's business is all about helping companies to go mobile. It provides software, enabling businesses to optimise their operations for use on the mobile devices of its customers or employees.

It is a Greek company quoted on the AIM market of the London Stock Exchange. Earlier this month it divested of its Greek operations by selling 51% of its holding to management for €11.2m. The reason given for the divestment was that it would allow the Company to focus on building its international mobile business, which now accounts for the majority of Group profits.

Go!Enterprise Server was launched a year ago and has started to gain traction. On Monday this week it announced its second contract win with a tier-1 mobile network operator for GO!Enterprise targeting "the commercialisation of both GO!Enterprise Office (secure e-mail, files, messaging and personal information management) and GO!Enterprise Mobilizer (development of mobile apps that connect to enterprise systems)". Commercial launch is expected to take place in January 2013 with the service being provided on a recurring monthly subscription per device.

In the release, the Company took the opportunity to update on progress across the business. It said that GO!Enterprise had experienced strong demand "resulting in a total of more than 900 active customers with more than 140,000 Business to Employee and Business to Business active licenses through the GO!Enterprise Office and Mobilizer license scheme, and a total of more than 80,000 Business to Consumer active licenses through the GO!Enterprise Reach license scheme." Globo has been building a partner network which it says is behind its success in gaining new customers.

The Company expressed confidence that GO!Enterprise will evolve into one of the major drivers of its future growth and said that following the successful launch of GO!Enterprise Server in the US in October it expects to announce several direct customers and partner deals soon.

I have been watching Globo for some time and now feel that the timing is right to buy a small holding in the Company. I think 2013 could be the year that the Globo share price makes real progress as it builds momentum through sales of its Go!Enterprise software. To me, it looks just too cheap valued on consensus earnings forecasts of 8.9x the year just ending, 7.3x to December 2013 and just 4.9x to December 2014. There are of course risks with a company of this size at this stage in its development, hence the 1.5% holding. (See transaction history) www.globoplc.com

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Globo plc is engaged in the provision of telecom, mobile software products and related services, as well as developing and operating broadband wired and wireless networks. The Company operates in two segments: Mobile products and services and Telecom services (S.a.a.S). Its Mobile products and services segment in sells its own mobile software products and services to its clients. Its Telecom services (S.a.a.S) segment combines telecom services with its own software products (e-business and WiFi services) that are then sold on software as a service basis. The Company’s WiPLUS consists of a managed service provided to hotels, airports, marinas and similar locations with Globo receiving revenue from venue owners. The Company’s GO!Enterprise is a platform for development, deployment and management of secure mobile apps. In June 2014, Globo PLC acquired services division of Sourcebits Inc. more »

Share Price (AIM)
38.25p
Change
-1.0  -2.5%
P/E (fwd)
4.5
Yield (fwd)
n/a
Mkt Cap (£m)
142.9



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About johnrosier

Johnrosier

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I manage my subscription website  www.JohnsInvestmentChronicle.com in which I show my portfolio and all transactions. I blog within an hour of trading, with an explanation, and send an alert email to all may subscribers. I do not pretend to have all the answers but I hope my portfolio, and the trades, provides food for thought as well as helping those who are new to managing their own portfolios.I think what I do is unique. There are plenty of tipsters out there who will remind you of the good ones and quietly forget the duffers; I do not have that luxury as the portfolio is there for all to see. I have to confront my mistakes and deal with them. A tipster also does not show how a tip fits into the context of an overall portfolio. My portfolio of up to 30 holdings has different holding sizes based on my conviction behind the stock and its risk. I set up www.JohnsInvestmentChronicle.com in January 2012. Prior to that :In September 1984, I left university with a degree in Zoology and started work in the City of London. Over the next twenty five years most of my time was spent managing UK equity portfolios with Fleming Investment Management and Henderson Global Investors, for company and local authority pension schemes as well as the reserve fund for a well known charity. During 2009 I left full time employment and decided to take time out to consider the next stage of my career. In the meantime I have been putting my years of experience to good use investing the family savings. I have thoroughly enjoyed the freedom of investing from home and despite some tricky periods during 2011 it has been a rewarding experience.  more »



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