Carnegie flags guidance miss risk, Pexip's shares skid

Pexip Holding ASA

13/10/2021 14:12

** Carnegie cuts Norwegian video-conference software
developer Pexip  PEXIP.OL  to "hold" from "buy" citing limited
signs of any growth acceleration in Q3, a risk of a guidance
miss and additional financing need
    ** Pexip shares slump 15% to NOK 52.9 on Wednesday and are
set for the worst day since May 2020
    ** "We are concerned about low sales efficiency and low ROI
on recent FTE investments," the broker adds
    ** It may partly stem from a high rate of new hires to
experienced employees, onboarding difficulties due to remote
working and tougher market conditions, Carnegie says
    ** Pexip might have to reduce hiring pace and cut its 2024
annual recurring revenue (ARR) target in order to avoid
additional financing need around 2023, according to the broker
    ** It expects Pexip to miss its $300 mln ARR target for 2024
    ** The broker also cuts target price by about 40% to NOK 65
    ** "While there may be valuation upside in the long term, we
believe that expectations need to be reset and that Pexip will
need to deliver tangible evidence of growth investments paying
off before the multiple can expand," Carnegie adds 

 (Reporting by Ina Kreutz)
 ((Ina.kreutz@thomsonreuters.com))