Alejandro Estebaranz presented his in-depth investment thesis on Umanis (Paris: ALUMS) at European Investing Summit 2016.
Umanis is an IT services and consulting company focused on sub-segments of business intelligence and big data. Umanis was founded in the 1992 by its current CEO (former director of research at EDF). The company has grown sales from €50 million to €160 million over the last six years and at a rate of 20% annually over fifteen years. The business earns high returns on invested capital and is resistant to crises. Umanis has repurchased ~40% of shares outstanding over the last six years. The founders own 66% of the equity. Organic growth of 5-10% is supplemented with acquisitions made at attractive prices. Industry sales should grow at a rate of close to 10% in the coming years. The company has a strong balance sheet, with debt to EBITDA of 0.5x. The shares are cheap at EV/EBIT of 3.9x, EV/EBITDA of 3.8x, and price to FCF of 5.5x. While the stock trades around €23 per share, Alejandro estimates current value at €50-60 per share and expects value to grow to as much as €75-100 per share over the next three to five years.
About the instructor:
Alejandro Estebaranz is the co-Investment advisor of True Value fund since its inception. True Value is a long only equity fund founded in January 2014, and focused in small and mid caps. Prior to True Value, Alejandro worked as an analyst for private investment partnerships. He holds a degree in mechanical engineering and a degree in industrial engineering.
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