PPH - PushPay (Church/donor software.)

[Nigelk]

As i've mentioned on here, it makes sense as a business strategy to cross-sell and offer more that just a payment solution.
More attractive, better retention, higher ARPU and it will always be more efficient to deal with existing users.
It's working and as stated above, has lots more potential.
The only problem is that some people, including "expert" analysts just look at little growth in total customer numbers and assume that means little revenue growth.

[sb9]

Always a good sign when Director buys a decent stake on market.

[Greekwatchdog]

NEUTRAL
We upgrade Pushpay (PPH) to NEUTRAL given 1) the recent de-rating of the stock, 2) better than expected customer
growth numbers reported in 2H21 (company expects run rate to continue into FY22), and 3) an encouraging start from new
CEO Molly Matthews who brings a relationship based approach to customers, given her experience in previous roles. PPH's
FY21 result reported weaker revenue and EBITDA growth than expected, despite raised net church customer additions in
2H21. This was predominantly due to the majority of 2H21 net additions to the processing platform sized at the lower end
of the medium to large category (between 200–500 congregation members). We note this is 1) an inferior mix of additions
relative to previous years, 2) likely to generate a slower rate of future back book growth, and 3) is positioned in the most
competitive size distribution in US church technology currently. More encouragingly, cross-selling between PPH's church
management system and donor management platform increased in 2H21, while the rate of churn softened.
What's changed?
Key FY21 result takeaways
PPH provided FY22 EBITDA guidance of UF$56–60m, against our prior FY22 EBITDA forecast of US$68m. During FY21, 747 net
customers were added to the processing platform (vs our forecast 500), of which 75% were sized under 200 members.
M&A still the way forward to ignite future growth
With the company positioned to pursue the Catholic market and looking to retain its dominant position in the Evangelical market, we
see further M&A as likely. As detailed in our report 'Pushpay Holdings: New Year, New Me The M&A Dilemma' dated 28 January 2021, we
believe there are a small number of suitable takeover targets which may enhance PPH's position, although there is a risk of overpaying for the target company and no guarantee that PPH can generate synergies.
Catholic market remains PPH's priority
Despite a low digital penetration currently, we remain cautious of PPH's Catholic success given older demographics, inertia towards
technology, the challenge of declining attendance, lower historical giving trends and a more formal service structure reducing the
chance to solicit donations. In our numbers prior to the result we assumed PPH could service 26% of US dioceses (50 of the 196
dioceses) by FY31E, with PPH now targeting 25% market share by FY26E. We make no changes to our Catholic revenue assumptions

[sb9]

Thanks for that GWD.

Key FY21 result takeaways
PPH provided FY22 EBITDA guidance of UF$56–60m, against our prior FY22 EBITDA forecast of US$68m

I think they got the above bit completely wrong, as per company's outlook statement, below is what they've guided.

Pushpay is expecting to achieve EBITDAFI for the year ending 31 March 2022 of between US$64.0 million and US$69.0 million, although uncertainties and impacts surrounding COVID-19 and the broader US economic environment remain.
Excluding the impact of the investment into the Catholic initiative, Pushpay expects to achieve EBITDAFI for the year ending 31 March 2022 from the current business of between US$66.0 million and US$71.0 million.

[flyinglizard]

There are number of ways to increase the revenue. Ads revenue if PPH wants to implant ads in their apps. Biden increases tax, that means billionaires and high income group have incentive to donate somewhere. Target on these groups and contact with University scholarship or lab department to promote its Apps, etc.

[Nigelk]

[QUOTE=BlackPeter;884814]Well, yes - both revenue as well as earnings went up, this is good - and even their NTA went from negative 4 cents per share to positive 1 cent per share. Lets start the celebration, shall we?

I guess a wee damper might be their underperformance compared to analyst earnings expectations - analyst consensus EPS for FY 2021 was 9 cents (NZ) per share. PPH delivered only 2.8 US cents per share, that's roughly NZ 4 cents.

Spot the difference? But hey - earnings still doubled last year and if they keep doubling every year, the current PE of something like 42 is clearly justified. However - what if not?




I don't get your numbers. If EBITDAF is USD$58.9m (NZD $82m) and the MC is $1887m, isn't that 23x. Not bad for a firm growing so fast.
Revenue = $NZD 250/m, so 7.5x revenue based on a MC of $1887m

[BlackPeter]

Well, yes - both revenue as well as earnings went up, this is good - and even their NTA went from negative 4 cents per share to positive 1 cent per share. Lets start the celebration, shall we?

I guess a wee damper might be their underperformance compared to analyst earnings expectations - analyst consensus EPS for FY 2021 was 9 cents (NZ) per share. PPH delivered only 2.8 US cents per share, that's roughly NZ 4 cents.

Spot the difference? But hey - earnings still doubled last year and if they keep doubling every year, the current PE of something like 42 is clearly justified. However - what if not?

I don't get your numbers. If EBITDAF is USD$58.9m (NZD $82m) and the MC is $1887m, isn't that 23x. Not bad for a firm growing so fast.
Revenue = $NZD 250/m, so 7.5x revenue based on a MC of $1887m

Sorry - I don't work with fiction (like EBITDAF) and I never talked about the market cap (which would be underlying value + hype). The only earnings which count are NPAT. Anything else is a fiction, because companies actually do need to pay interest, amortization, depreciation and taxes.

Try again with NTA (net tangible assets) and EPS = Net profit after tax divided by the number of shares.

If you still have problems, let me know :

[Sir Ten]

I think I'm close to done with PPH.

I'm more than covered on my existing position but the increasing number of significant insider sell-downs are a signal.

Taking my own advice (see previous posts) and putting half of what I have left onto the market. Balance is option play.

[Rawz]

I see Facebook have been talking to one of the big churches in the USA about how to integrate faith and their members into facebook. Facebook building apps based on discussions with the church including apps for gifting.

Like all things facebook offer it will be free. Facebook will generate further ad revenue from it.

Could be a big headwind for Pushpay.

[Sir Ten]

https://section4.lt.acemlna.com/Prod...0A1655A2A33849

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