Jefferies lifts PT, rating for Australia's Megaport

Megaport

27/07/2023 20:55

** Jefferies upgrades its FY24 and FY25 EBITDA forecasts for
Australian cloud services provider Megaport  MP1.AX , raises
price target and rating 
    ** Lifts FY24 EBITDA forecast by 5% and FY25 EBITDA forecast
by 8% for MP1
    ** Brokerage hikes price target for MP1 to A$12.55 from
A$9.55, upgrades rating to "buy" from "hold" 
    ** Says MP1 could comfortably print positive free cash flow
(FCF) in FY24 with some buffer for "strategic initiatives",
which would deliver more growth
    ** "We are surprised by how the business could sustain
strong growth rates despite not having a full team of direct
sales force," says Jefferies 
    ** Brokerage says since the business is now profitable, and
it is generating FCF, so the risk of equity raising is minimal
    ** Seven of 13 analysts rate the stock "buy" or higher, five
"hold" and one "sell"; their median PT is A$9.10 – Refinitiv
data
    ** MP1 stock up 68.3% YTD, as of last close 

    

 (Reporting by Echha Jain in Bengaluru)
 ((Echha.jain@thomsonreuters.com))