paragon (PGN)

Business description

paragon designs and manufactures advanced automotive electronics solutions as a direct supplier to the automotive industry. Products include: sensors, acoustics, cockpit, electromobility and body kinematics.

Investment summary

Having delivered results that were in line with our expectations, paragon has guided to strong progress in FY18 with sales rising by 40% to around €175m and an adjusted EBIT margin maintained at around 9%. The growth will be primarily driven by Electromobility (Voltabox), but there will also be strong development by the smaller Mechanics division with good organic progress in Electronics. The current rating seems to be depressed by technical factors and does not appear to reflect the growth prospects.

Last updated on 09/04/2018

Y/E Dec Revenue (€m) EBITDA (€m) PBT (€m) EPS (fd) (c) P/E (x) P/CF (x)
2016A 102.8 16.1 5.8 84.43 70.4 N/A
2017A 124.8 20.6 6.9 65.02 91.4 N/A
2018E 178.4 33.0 13.4 197.87 30.0 N/A
2019E 238.7 46.0 24.2 309.60 19.2 N/A

Last updated on 09/04/2018

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Executive Interview - paragon

Industry outlook

We believe the growth story of paragon is understood by the capital markets, following the successful issue of €50m bonds in June 2017 and the spin-off of its subsidiary, Voltabox, in October 2017 to raise gross proceeds of €152m. In order to generate further appreciation of its share price, paragon needs not only to deliver on its €1.2bn lifetime order backlog, but also to create further growth engines.

Last updated on 06/04/2018

Key management

Klaus Frers, CEO

Company address

Schwalbenweg 29
Delbrück
33129
Germany
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