Research on Beeks Financial Cloud Group Plc (BKS:LON) from Progressive Equity Research
Beeks has announced three contract wins across its Analytics, Proximity Cloud and Private Cloud offerings, with a combined total value of c.£1.7m. This sits alongside the Market Edge Intelligence contract win earlier this week, a banner five-year contract with a US$4.8m (£3.6m) price tag at an unnamed ‘major global bank’. These contracts offer ‘expansion potential’ across the customers’ operations and Beeks’ customer base, and given the deployment model, Market Edge Intelligence smacks of a ‘land and expand’ bridgehead for new logos. The brace of contracts signals a structural move into a higher gross profit margin world. Recall at interim results CEO Gordon McArthur stated that Beeks entered H2 ‘with strong momentum’ – here is the £5.3m proof point. We trace the core software functionality back to the £4.2m Velocimetrics acquisition (April 2020), a price tag now dwarfed by these contracts. We make no changes to our forecasts as the contracts support FY26 estimates. Our view: Beeks is a long-term secular growth investment play, ‘best of breed’ financial model, with a strengthening moat and is executing on a global TAM. This is not reflected in the pedestrian 8.0x FY26E EV/EBITDA vs 13x for the peer group.
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