Some updates: Wise Plc, Rightmove Plc, Eurokai KgAA, Bouvet ASA, Bombardier
Wise Plc
Just a few days after my writeup, Wise published 6M numbers. On the positive side, with regard to Transfer volume, new customers and deposits, Wise grew strongly between 18-37% as we can see in this chart:
However, Profit before tax and margins went down:
Underlying Profit, which only assumes a 1% “take rate” on deposits increased by 13%. This is clearly a combination of lower gross interest incomes, deliberately low take rates (0,52%) and investments into marketing and technology.
The stock reacted initially quite strongly, but recovered most of this over the next days.
To me this shows that most investors seem to understand the main story: Taking market share now by lowering prices for customers in order to maximise long term value.
As a new owner, I will continue to monitor their progress. I bought a few more shares at around 9 GBP/share.
Rightmove Plc
Rightmove is a company I have been following for a long time. It is a fantastic business that monetizes the obsession of the British with Real estate.
The company is insanely profitable but the share price hasn’t done much over the past 5 years:
A little bit more than a year ago, Australian peer REA had tried to take over Rightmove at ~7,8 GBP per share but management rejected the bid.
What I found especially interesting was the large drop (initially -28%) after the most recent quarterly update. Analysts seem to have been especially spooked by additional planned investments into AI which would lower Operating profit until 2028 before growth is expected to speed up again:
“Investing for future growth is not a bad thing but the scale of the market’s negative reaction implies real scepticism about its decision to put so much money into AI,” said Russ Mould, investment director at AJ Bell.
“It’s possible to see how AI might help Rightmove operate more efficiently, make greater use of its increasing amounts of data and enhance user experience on the site,” he added.
“However, there is clearly concern that Rightmove is jumping on the bandwagon in dialling up its AI spending.”
It seems that the overall expectation from analysts is that any AI expenses are immediately set-off by savings (i.e. firings) and no one expects that profits will be lower at first because of AI investments.
That itself to me seems overly optimistic, especially also reflecting on my personal experience in my day job.
However, Rightmove is clearly also an example that paying 40 or 50x NTM P/E on a high quality stock often leads to disappointments. Right now, the stock looks more fairly priced:
In any case, Rightmove is an interesting company that I want to dig in deeper at some point in time.
Eurokai KgAA
Eurokai came out with two pieces of very good news. First, their 9M trading update confirmed that 2025 will once again be a very good year with strong growth especially in the Eurogate Segment:
And secondly, they announced that they have a term sheet with Container Shipper CMA CMG to sell 20% of the Eurogate Hamburg Terminal.
Eurogate (in which Eurokai holds 50%) owns the Hamburg Terminal fully. A lot of other Eurogate Terminals are already co-owned with shippers, ike MSC, Maersk or Hapag Lloyd.
My back of the envelope calculation indicates that the 20% could be worth 100 mn EUR. This would mean 50% of that money economically belongs to Eurokai and will flow to a large extent into the P&L for 2026.
In addition, I think it is also a good benchmark for what the whole asset pool is worth.
The share price reacted a little, but not by that much:
Bouvet ASA:
The third quarter is always the weakest one for Bouvet, but this years 3rd quarter was especially weak with EPS down ~10% yoy for the quarter.
In essence, personnel cost grew faster than sales. The stock which was week already for some time dropped even further,
9M EPS is more or less unchanged against last year but investors seem to have expected more. The stock trades currently at 15-16x EPS, which is quite cheap and indicates only a limited amount of growth implied in the current stock price.
I guess that maybe some investors might be scared of imminent replacement of consultants through AI, but honestly I don’t believe this.
Bombardier
Last but not least, Bombardier released Q3 numbers some days ago. Operationally, things went into the right direction. Sales, EBITDA, EBIt etc. are all up more than 10%.
The highlight clearly was that Cashflow improved significantly in this quarter which might allow them at some point in time to start buying back shares:
Interestingly, it took a few days until the market digested this and the shareprice went above the 200 CAD per share mark.
value and opportunity 
Regarding Eurokai you still seem to be very optimistic, although the share price has risen considerably since your purchase, obviously increasing the valuation KPIs.
What is your opinion on the fact, that despite the volume of containers increasing by 15%, the guidance for profit 2025 is still BELOW 2024, even corrected for the one-time effect in 2024. I think, this is really disappointing, specially if one considers, that the ‘lagergelderlöse’ are still at an unusually high level.
Something (contractual terms in the new consortium?) must have reduced the fees, that Eurokai can charge, considerably. Otherwise the profit MUST go up if, if a company has 15% volume increase.
But maybe I miss something…
Regarding Eurokai you still seem to be very optimistic, although the share price has risen considerably since your purchase, obviously increasing the valuation KPIs.
What is your opinion on the fact, that despite the volume of containers increasing by 15%, the guidance for profit 2025 is still BELOW 2024, even corrected for the one-time effect in 2024. I think, this is really disappointing, specially if one considers, that the ‘lagergelderlöse’ are still at an unusually high level.
Something (contractual terms in the new consortium?) must have reduced the fees, that Eurokai can charge, considerably. Otherwise the profit MUST go up if, if a company has 15% volume increase.
But maybe I miss something…
Are value investors perennially attracted to lagging stocks going nowhere? There were 2 people commenting in the Wise article, saying that Revolut is much better/useful/better offer. Yet you think „Wise is not competing with Revolut“ (on what planet?) and of course bought it. Good luck, will be interesting to see how it goes.
Fair comment but I do think that Wise and Revolut have very different business models. If course I might be wrong.
Did you see that Wise is looking to issue debt?
They issued debt (i.e. credit lines) in the past. It makes sense looking at the business model.
Regarding Eurokai: Eurokai needs the money for investments in Hamburg
Eurogate plant Ausbau des Containerterminals HamburgDas Thema, das bei diesen Gesprächen im Mittelpunkt stehen dürfte, ist, dass Eurogate seine jährlichen Umschlagskapazitäten in Hamburg von derzeit vier auf sechs Millionen Standardcontainer TEU ausbauen will. (…) Die Kosten in Höhe von annähernd zwei Milliarden Euro müssen sich die Stadt und Eurogate teilen: Die öffentliche Hand investiert 1,1 Milliard
en Euro in die Fertigstellung der Infrastruktur. Eurogate hat einen Mietvorvertrag für die entstehenden Flächen gezeichnet und sich verpflichtet, für 700 Millionen Euro die eigentliche Erweiterung des Terminals mit neuen Schiffsliegeplätzen entlang der rund 1000 Meter langen zusätzlichen Kaimauer und neuen Containerbrücken zu bauen.Finanziell starker Partner zum HafenausbauEin Problem: das Geld. Eurokai hatte zur Mitte des Jahres zwar 223,2 Millionen Euro Mittel auf der hohen Kante. Der geplante Ausbau verschlingt aber viel mehr. Das Unternehmen Eurogate, das neben Eckelmann zur anderen Hälfte der Bremer Logistikgruppe BLG gehört, will nicht nur die Erweiterung ihres Terminals an der Elbe bezahlen, sondern auch ihre bestehenden Anlagen modernisieren und fit machen für das digitale Zeitalter. Deshalb müssen ferngesteuerte Containerbrücken und automatisierte Lager angeschafft werden.(…)
from Hamburger Abendblatt
Of course does the extension require investment. However, they real Capex will only start in a few years and in theory they would have a significant capacity to raise debt. I think they sold the stake because CMA wanted in, not because they need the money.
Thanks for the summary. Nothing too add to DCC plc? Simply to boring to comment on the recent results and waiting for the tender offer?:)
I am sorry that despite the high price of your subscription, I am not able to comment on each and every company each quarter within business days.
Jokes aside, I’ll try do do as much as time allows. But I can’t comment on every stock every quarter.
Sure, was just curious whether you skipped it because there is not that much to write about maybe except from excess capital to be returned to shareholders in due course and management now specifying the disposition of the „technology segment“ sometime before year end 2026. I am long DCC
On Wise PLC, underlying revenue increased by 13%, underlying profit fell 17% (which was not included in the presentation charts). The British use “Income” to refer to revenue, which is confusing for me (and I assume other Americans).
I also bought into the Wise PLC story. I believe their roughly 21%~ underlying profit margins in 2025 gave investors a taste of how profitable the company could be if they turned off their price cutting strategy and just let it rip on margins.
You are correct. Thanks for pointing out. They actually guide towards 13-16% operating profit margins. So the 22% from the year before were clearly an outlier.