Altium – Technical Review

Altium is under Algo Engine buy conditions.

ALU’s comments point to a continuing challenging trading environment, due to COVID-19, particularly in the US. The company reiterated FY21 guidance for 6 – 12% revenue growth and EBITDA US$76-89m.

Watch the short-term indicators for a turn higher within the $31 – $34 price range.

NOTE: High risk trade due to extended PE valuations.

Altium – FY20 Reviewed

Altium creates software to help people design circuit boards for electronic devices. Altium has aspirational targets of $US500 million in annual revenue and 100,000 subscribers by 2025.

FY20 EBITDA was better than consensus with FY20 revenue of $189m, + 10% on the same time last year, EBITDA $72m. The company generated record subscriber growth, surpassing its 50,000 subscriber goal.

Full-year unfranked dividend increased to $0.19 and earnings before interest and tax climbed 13% to $US64m for the year ended June 30.

A highlight for the company in the last 12 months was the launch of its cloud-based electronic design subscription platform Altium 365. For 2021, the company forecast revenue growth to be in the range of $200 – $212mn or an increase of 10%.

Altium – algo update

Altium switched from sell to buy conditions in July 2018 at $21 and more recently we had an Algo Engine buy condition again in May at $31.00.

ALU is a strong momentum play and the stock is now up 10% in the past 4 weeks. We continue to hold ALU and will look to take profit once the short-term indicators turn negative.