Lightspeed Commerce Inc T.LSPD

John Zechner - BNN - TOP PICK

[Possibleidiot01]

TOP PICK

Lightspeed Commerce (LSPD-TSX)

Lightspeed provides an easy-to-use omnichannel POS software platform. Its software enables retail and hospitality merchants to manage operations, accept payments and grow their businesses. Lightspeed’s platform is used at around 165,000 organic customer locations. Lightspeed’s shift in strategy should yield improved business plan execution and revenue growth, and expand adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) as 2025 progresses. Growth can come from higher subscription revenue. The announcement last week that they have engaged JP Morgan to look at strategic alternatives, including a sale of the entire company, should accelerate the realization of this undervaluation. Lightspeed trades at 1.8 times EV/F2025E sales versus peers at around 5.5 times in C2024E.

Lightspeed Commerce Inc(LSPD-T)

01/10/2024

 

A top pick because it could be bought out. Look at Nuvei. Is down 85% from its peak. LSPD is focusing more on larger customers. They finally broke even on cash. If a deal happens it will happen in 3-6 months, or else shares fall.

(Analysts’ price target is $24.82)

Technology

 

N/A

Owned

[equityresearch]

Really big opportunity here. Market has been irrational with this stock. Sale may occur at a premium over the next few months as noted in the clip. However, even if a sale does not occur, the stock should start its upward momentum with profitability in sight.

[equityresearch]

Lightspeed’s revenue is approaching Nuvei’s when they started seeking a sale. Lightspeed’s balance sheet is much better though. Nuvei ended up selling for USD $6.3B (CAD $8.6B). Lightspeed’s current market cap is USD $2.4B (CAD $3.3B).