Record Results Can Propel This Software Small Cap

23% growth, 8x EBITDA.

Good morning,

Today we are publishing on a small UK software company that may be approaching an important inflection point.

In results released last week, organic ARR growth accelerated to approximately 23%, and recurring revenue climbed to 81% of total sales.

The company also secured a strategically important US order from a leading medical-device manufacturer, with scope to expand into additional sites.

With a debt-free balance sheet, embedded products and significant scope for margin expansion, we think this business can evolve into a more durable compounder.

Yet shares still trade at a meaningful discount to peers.

Let’s dig in…