On watch, page-2

I agree.

I think the risk v reward for CAT is now strong and I've gone long again. I exited straight after the capital raise somewhat fed up with the abrupt nature of the raise and a fear the price could again sink.

Pleasingly the price has consolidated well in the three months since the raise and there a two new institutional investors holding >5%.

My view is that the market has priced in CAT missing their full year revenue targets off the back of the H1 result. The 4C will give a good guide, but recurring revenue businesses such as CAT have a strong degree of 'forecastability" and management have been steadfast they will hit that range. The exchange rate is also on their side which should give an extra little boost.

We've also seen some nice momentum with new deals with Scottish rugby, Swedish football, Playertek/Eygpt and more we've probably not heard about. This is their main selling period with it the northern hemipshere off-season. I know they lost US soccer and Brazil but a competitor irrationally basically gave that away for free.

I also think the Football world cup will put a focus on sports tracking which will shine a light on CAT. At the last WC in 2014 CAT was still in its early stages. Staggeringly only 18 of the 32 teams use Catapult or Statsports, which shows you how far the market can still expand.

Currently the business trades at 3.1x forward revenue at the bottom end of their forecast range, while other peers can trade up to 10x+ revenue. Here's where I see the risk/reward being strong if the business hits its revenue targets and shows some forward momentum.


This is not in any way financial advice and please do your own research.