KME – Kip McGrath | Aussie Stock Forums


KME @ 0.91 Monday close

Kip McGrath would be one that I think I’d be accumulating if it were not for the fear of the general bust ahead.

Two directors were buying on market very recently at almost 99c per share with the price closing at just 91c on Monday. The directors spent about $50k and $100k.

The price has been almost at the 90c placement price that raised $5.9m, announced June 6. Price back up so far today on neglible volume.

If you take the presentation that accompanied the cap raise as read, the new equity is to constructively fund extra staff and a marketing campaign for the cloud based Kip Onlne remote learning service. It’s like the Kung Flu interruption has been a springboard for the online version of Kip lessons because it forced students to try it instead of face to face lessons and most of them liked it. Online lessons went from 10,000 over 5 years, as the platform was developed, to 20,000 in a single week during the advent of Covid-19.

The ‘addressable’ student market using Kip Online in U.K, N.Z, S.A and AUS is much much larger than face to face as 60% of students are remote from a K.M learning centre.

In the short term Kip won’t shine because, while FY20 revenue is expected to be up on FY19, EBITDA was slightly lower at 30 April vs same period last year. But Kip’s EPS and ROE have consecutively grown for the last 7 years and book value has been inching ahead too. ROE was 22.5% in FY19. Company has no long term debt.

Kip Mcgrath has engaged only 1% of the potentially enrollable students in AUS alone and across the four countries it is so far positioned in there are estimated to be 20 million reachable students.

Held

Weekly chart does look a bit dodgy imo

 

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