Pointer Telocation (PNTR)

Business description

Pointer Telocation (PNTR) is a leading provider of MRM services and products to the automotive and insurance industries. Key services are asset tracking, fleet management and monitoring goods in transit/IoT. Its main markets are Israel, Brazil, Argentina, Mexico and Europe.

Stock data

Market cap.US$69.1m
Last closeUS$8.85
High / Low (52 weeks)US$9.6 / US$5.2
Stock market listingTel Aviv Stock Exchange, US
Forecast net debt (US$m)5.4
Forecast gearing ratio (%)11
TeamTechnology
SectorTechnology

Price performance

%1m3m12m
Actual13.719.652.7
Relative *14.815.633.7

* % Relative to local index

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Company news

Y/E Dec Revenue (US$m) EBITDA (US$m) PBT (US$m) EPS (fd) (c) P/E (x) P/CF (x)
2015A 60.6 8.1 6.3 62.3 14.2 7.0
2016A 64.4 9.4 6.6 62.4 14.2 6.8
2017E 71.9 11.5 8.4 78.4 11.3 7.0
2018E 78.1 14.0 10.6 97.6 9.1 5.7

Last updated on 16/03/2017

Investment summary

The group has started 2017 well with two significant contracts – a highly prospective one for driver behaviour in NY for ride firms such as Uber and Lyft, followed by a pilot programme for driver safety and distribution costs savings with FEMSA (Coca-Cola’s largest public bottler). A strong performance in these contracts bodes well for future earnings. Pointer has also announced better than expected 2016 operating results, helped by margin-boosting operational leverage, and acquisition of Cielo Telecom in Q4. Management has also issued guidance for over 10% revenue and 20% EBITDA growth this year, which accords with our increased earnings expectations. Helped by this, we have revised our share valuation, which is based on peer multiples, from $8.85 (NIS 33.9) to $10.8 (NIS39.6). This is supported by our DCF valuation of $14.9 (NIS 54.7) per share.

Last updated on 16/03/2017

Industry outlook

The global telematics market (services and products) is forecast to grow at an 18.9% CAGR between 2015 and 2020 according to Driscoll & Associates reflecting the growing sophistication and integration of telematics devices into business frameworks and increasing legislation requiring the use of telematics. Less developed markets such as Latin America and Africa are forecast to achieve higher CAGRs of 15.6% and 17.3%, respectively during this period.

Last updated on 02/03/2017

Key management

David Mahlab, CEO
Zvi Fried, CFO

Company address

4 Hamelacha Street,
Rosh Ha’ayin
48091
Israel
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