Craneware (CRW)

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The leader in Value Cycle solutions for the US healthcare market.

8-Nov-2017 – 1492.5p – £405.1m – PER 34.9

AGM Statement – A positive start to the 4 months of this year, well positioned to execute the growth strategy.

I do quite like this – Steady increases in Revenue, Profits and EPS here, 5%, 10% and 10% (CAGR) or thereabouts, respectively.  The ROCE is also impressive, consistently around 25% or so. There’s a small (1.5%) Dividend that’s well covered and it’s also got Cash (more than 10% of Mkt Cap).  So, there’s lots to like here but for me, the growth should be better than this to justify a PER of 34.9 – Although I did say this when the SP was 1250p and the PER was 30!

8-Jan-2018 – 1520p – £409.8m – PER 35.7

Trading Update For The 6 Months To End December 2017 – H1 strong and a significant new contract win too. Renewals (in value) at 100%. Expects Revenue and EBITDA to be up in H1 15% – 18%.

I still quite like this but on a PER in the 35 range I would expect more growth that 15% – 18%. As I note I do remember also saying this when the SP was 1250p and the PER was 30!

6-Mar-2018 – 1925p – £507.1m – PER 43.2

Interim Results For The 6 Months To End December 2017 – Revenue up 16% to $31.1m (H1 2017: $26.8m), PBT up 16% to $8.7m (H1 2017: $7.5m), Adjusted basic EPS up 18% to 25.4c (H1 2017: 21.6c), Cash of $52m (H1 2017: $45m) following dividend payment of $4.1m with the proposed Interim Dividend up 15% to 10p (H1 2017: 8.7p).

I have been saying this is expensive on a PER of 30 and 35 and it’s now 43. I am coming to the conclusion I got it wrong here. However, based on these interims I cannot justify paying up on a PER of 43.  Rightly or wrongly! What am I missing here?

3-Sep-2019 – 1825p – £490m – PER 33

Results For The 12 Months To End June 2019 – Revenue up 6%, PBT down slightly, EPS up slightly, Cash at $47.6m ($52.8m, $8.5m returned as Dividend). Strong start to the year with a strong sales pipeline.

Even 50% off it’s 52 Week High I still don’t see value – I still reckon I am missing something here, perhaps!

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