All Danish Shares part 2 – Nr. 11-20
And on we go with the second post after kicking off last week. Two of the stocks already appeared in the blog some years ago and overall, these ten candidates yielded two “Watch list” candidates.
11. Conferize A/S
Conferize is a 15 mn EUR market cap company that seems to develop software for managing conferences. The company seems to be still “pre revenue”. I do not fully understand why a pre revenue Software company is public, but I’ll happily “pass” without further analysis.
12. Jobindex A/S
Jobindex is a 220 mn EUR market cap company that operates an online Job board which covers all Danish vacancies. The company has been growing nicely until 2018 but then stagnated already in 2019. The chart reflects this to a certain extent, the share price now is similar to the price during the “high growth” phase:
The recovery from Covid has been strong and Jobindex has been raising estimates most quarters. The most recent trading update indicated operating profit of around 170 mn DKK or around 23 mn EUR for 2021.
Fundamentally, a tight job market is usually good for these portals as employers have to make an effort in order to attract talent.
Although the company only reports in Danish, the stock looks interesting. The 23 mn EUR Operating profit should translate into an EV/EBIT of below 10 as the company has not debt. “Watch”.
13. Copenhagen Capital A/S
Copenhagen Capital is a 52 mn market cap company that seems to invest into residential and commercial Real Estate. As I am not interested in real estate companies in general, I’ll “pass”.
14. Gronlandsbanken A/S
Gronlandsbanken, a 150 mn EUR market cap bank active only in Greenland, is an “old friend” for me as I actually invested into Gronlandsbanken in 2012. I sold the shares in 2015 as I was concerned about what zero rates do to banks. Just looking at the chart, this was clearly a good decision:
Interestingly, Gronlandsbanken did increase their net income from 40 DKK/Share to around 70 DKK/Share (est. 2021), however they seem to have reduced their pay out ratio from 100% to around 50%. So P/E has actually decreased from around 16x to currently around 9x. The same actually happened for many other financials, but the stability of Gronlandsbanken is remarkable. “Watch”
15. Luxor A/S
Luxor is a 81 EUR mn market cap investment company that invests into a wide range of assets. The company only reports in Danish. Although the long term track record looks Ok, I am not that much interested in investment companies. 86% of the shares seem to be in fixed hands. “Pass”.
16. Lollandsbank A/S
Lollandsbank is a small, 85 mn EUR market cap regional bank that has a quite “constructive” stock chart for a bank:
Operationally, the development was less exciting, with profits more or less flat since 2016. The biggest driver seems to be an increase in P/E multiple from around 5x in 2016 to somewhere between 8-9x today.
Regional banks are not my focus, therefore “pass”.
17. CBrain A/S
CBrain is a 560 mn EUR market cap software company that specializes in business automation solution. the stock chart looks similar to other software companies with a big draw down from its recent peak:
With 27x P/revenue (2021), the stock looks still very expensive. Growth is ok, but not spectacular, the same goes for profitability. Not sure why people thought that this is worth 50x revenue a few months ago. “Pass”.
18. Enalyzer A/S
Enalyzer is a tiny, 2 mn EUR market cap software company which isn’t profitable and whose share price has done little over the last 10 years. “Pass”.
19. Novo Nordisk A/S
Novo Nordisk is clearly “The” Danish Flagship company with a market cap of 167 bn EUR. I have looked at the company two times in 2016, first here and then here. Buying back then at 220 DKK per share would have been a killer move for “Hindsight Capital llc” as the chart shows:
The interesting part of the story is that revenues indeed dd not grow that much since 2016, only about 5% p.a., net income slightly more. EPS however have grown 6,7% due to the wonders of share buy backs. The “kicker” however came from a nice multiple expansion from around 17x (Trailing EPS) to currently 32x.
What haven’t changed since then is the fact that I do not understand the business. At the current valuation, the upside seems to be quite limited even considering ongoing buybacks. “Pass”.
20. Penneo A/S
What in German would sound like a Sleep focused company is actually a 61 mn EUR market cap company specializing in workflow automation software for accountants. The company has revenues but also losses which are increasing even in relative terms. At 9x revenues, this doesn’t look so good for a loss making software company with some growth. The Ebitda margin of -44% compares only with 34% yoy growth, not enough to make this an interesting investment. “Pass”.