Mercer actuary David Knox says the data used to determine the old age dependency ratio is “totally out of date” and overstates the severity of the problem.
From their inception, SMSFs have always attracted more than their fair share of criticism. Now it’s an ageing membership that’s being used to restrict their numbers.
As Nuix shares continue to tank, is now the time to buy?
Shares in software company Nuix Ltd (ASX: NXL) have slumped further today along with the broader information technology sector.
Nuix listed on the ASX last year at an offer price of $5.31 but rallied to highs of over $11 within the first month of trading.
Now, at $3.37 per share, Nuix’s market valuation has tumbled more than 63% since releasing its H1 FY21 results which didn’t meet the market’s expectations.
NXL share price
Nuix background
Nuix has developed software that’s able to extract insights and knowledge from unstructured data. Its technology has been used in some high profile investigations over the past several years.
One notable investigation was the “Panama Papers”, where Nuix’s software was used to scan over 2.6 terabytes of scanned documents to extract metadata that helped journalists cross-reference people, places and other businesses.
What’s been happening to the Nuix share price?
Nuix’s shares started heading south when it released its H1 FY21 results in February, which revealed relatively modest growth despite its lofty market valuation.
Revenue for the period came in at $85.3 million, down 4% yoy, which was only 44% of the FY21 forecast.
Annualised contract revenue (ACV) was reported as $162 million, a 3% increase on the period year.
Keep in mind that the company listed with a market capitalisation of $1.8 billion, with shares trading at around 9x projected revenue.
High valuations aren’t necessarily a bad thing, but it implies that investors are expecting high growth rates moving forward. So, it’s fairly easy to see why its shares were sold down after reporting such modest growth figures.
The sentiment around Nuix’s shares further deteriorated last month when management had to then downgrade its FY21 forecasts.
Management noted that it was partly attributable to the company transitioning its customers from module-based subscriptions to a consumption-based model, resulting in a shift in both the revenue and ACV profile.
What else?
As my colleague, Raymond Jang pointed out in his article, Nuix’s listed on the ASX at a time where the market was assigning extremely high values to popular tech stocks.
Today, the market is assigning much lower multiples to companies in the sector, so the broader thematic is, unfortunately, working against the Nuix share price at the moment.
Nuix is on my watchlist for now, as I think there could be some more short-term pain as investors rotate out of the sector, which could put some more downward pressure on prices.
Information warning: The information on this website was published by The Rask Group Pty Ltd (ABN: 36 622 810 995) and is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.
