RSS Feed

Related Articles

Related Categories

The Share Centre downgrades Monitise to a ‘hold’

29th September 2014 Print

Sheridan Admans, investment research analyst at The Share Centre, explains why Monitise has been downgraded to a hold.

“Monitise has come under some pressure since one of its main partners, Visa Inc, announced it is considering selling its remaining 5.5% stake in the company. This has sparked investor concerns that Visa Euro, which has a 6% stake in Monitise may take the same course of action. This has also put pressure on the share price and we now advise investors to ‘hold’ the stock while we wait for more clarity, and to see if Visa Euro follows its US counterpart.

“On a positive note the Chairman has responded to the weaker share price by doubling his stake in the business, as well as two non-executives increasing their holdings. Monitise also continues to attract high calibre partners and customers, helping to firmly integrate its proposition as the preferred interface between global financial institutions and their customers.

“Monitise still expects to achieve 25% growth in 2015, to become profitable the following year and to service 200 million users by June 2018 at £2.5 ARPU. There was also news of a deal with Santander to develop its mobile banking service, and Monitise said it expects to announce further new customers in the near future.

“We fear the selloff has been overdone and price weakness could provide a good entry point for investors that have considered exposure to the stock in the past and are considering a long-term investment in a payment provider.”