Conversation 187: With a P/E of 7.7 and an Enterprise value/EBITDA of 3.8 is the AVA Group misunderstood?
ABOUT THE AVA GROUP
The Ava Group provides risk management services and technologies to security-conscious commercial, industrial, military and government clients across the world.
The Group features a range of complementary solutions including intrusion detection and location for perimeters, pipelines and data networks, biometrics, card access control and locking as well as secure international logistics, storage of high-value assets and risk consultancy services.
SO WHY IS THE SHARE PRICE SO LOW?
CEO Rob Bloomfield told me that there may be an issue around the group’s visibility and profile with investors.
He believes some big contract wins could help in this regard.
However, he says a company shift to more innovative use of Machine Learning and AI, applied to AVA’s 2.5k installed existing systems, along with a shift to licensing and partnering deals with local suppliers, is showing the way forward for the group. He cites a recent tender contract win with the Indian Army, to protect their fiber optic critical communications network as an example.
He also believes this approach will result in more recurring revenue and an opportunity for AVA to generate SaaS-type offerings based on learnings from ML and AI system updates.
DIGITALX
ASX ANNOUNCEMENT 5 JULY 2021
2. COMPANY PRESENTATION 27 MAY 2021C