Checkit (CKT): Initiation - Smarter operations ...

Edison Investment Research Limited Checkit (CKT): Initiation - Smarter operations management 02-Dec-2020 / 07:00 GMT/BST London, UK, 1 December 2020 Checkit (CKT): Initiation - Smarter operations management Checkit has emerged from a period of corporate activity as a pure-play business focused on driving the adoption of its connected SaaS software, in particular its workflow management application. Checkit's software is designed to enable smarter operations management, exploiting Internet of Things technology to connect people, processes and assets. With a proven ability to sign up blue-chip customers across a number of target verticals, growth in recurring revenues and an expanding customer base should help to close the valuation discount to software peers. On an EV/sales multiple of 1.4x in FY21e, Checkit trades at a significant discount to the UK software sector (5.1x forward sales). On a sum-of-the-parts basis attributing EV/sales multiples that better reflect the performance and prospects for each division, we estimate that the stock is significantly undervalued. For example, using a 4x FY21e multiple for Checkit Connect and 1x for Checkit BEMS would result in a valuation of 72p per share. Key triggers to help Checkit attract a higher multiple include evidence that customers are signing up to use Connect software, existing customers are expanding their usage and, to a lesser extent, that non-recurring revenues are being converted to subscription services.  Click here to view the full report. Subscribe to Edison's content to receive reports by email. All reports published by Edison are free-to-access and available on the website. About Edison: Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world-renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisers and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting. Edison is authorised and regulated by the Financial Conduct Authority. Edison is not an adviser or broker-dealer and does not provide investment advice. Edison's reports are not solicitations to buy or sell any securities. For more information please contact Edison: Katherine Thompson, [phone] [e-mail] Learn more at www.edisongroup.com and connect with Edison on:  LinkedIn  https://www.linkedin.com/company/edison-group- Twitter   www.twitter.com/Edison_Inv_Res YouTube  https://www.youtube.com/user/EdisonITV/videos Dissemination of a CORPORATE NEWS, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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