Analysts at Cornerstone FS PLC (AIM:CSFS)’s house broker SP Angel have revised up the foreign exchange and payments specialist’s full-year guidance following today’s stand-out trading update.
Cornerstone hailed its first EBITDA-positive quarter after unexpectedly doubling revenues to £1.95mln.
SP Angel responded by increasing 2023 revenue expectations by 14% to £6.5mln, with underlying EBITDA estimated at £100,000 against previously predicted losses of -£1.1mlln.
Losses before tax are expected to come in at -£700,000, while cash is expected to grow to £1mln by the end of 2024, “with sufficient cash generation to pay the earn-outs and loan notes through to 2026”.
“We believe this trading update combined with the agreement to revise the earn-out structures from recent acquisitions, as well as the confirmation of the Avila House divestiture warrants an upgrade to our forecasts and valuation,” said SP Angel, issuing a buy rating.
Analysts did not provide a specific price target, but did note that “ we expect the stock price to rebound from current levels”.