Weekly Reports | 10:00 AM
A smorgasbord of stock snacks in this week's In Brief, including Australia's own agentic AI platform, good news for Shape, gaming company Light & Wonder, while Audinate gets an upgrade.
-A small gem of an agentic AI company partnering with Amazon Web Services
-Shape's trading update is good, but has the share price gone too far?
-Looking through a year of consolidation for Audinate
-Some goods news for Light & Wonder's litigation
By Danielle Ecuyer
This week's quote comes from Barclays:
"The US economy won't boom, nor will it go bust, this year. Europe is making progress, but it won't solve all its problems in a few months. Although they may think twice about where to put their money to work, global investors won't abandon US assets. Artificial intelligence won't take over the world tomorrow, but it won't disappear either."
Agentic AI up and running for Decidr
Artificial intelligence is not the sole privilege of US Megacaps. MST Financial updated its thoughts and views on Decidr AI Industries ((DAI)) this week; one to keep on the microcap radar.
Formerly known as Live Verdure, the company rebranded in March to reflect the strategic shift to AI and "decision intelligence" technologies.
The Decidr platform enables AI agents to be across most areas of business by providing a suite of intelligent applications across marketing, sales, finance, human resources, operations, and customer service to improve efficiency.
The company is partnering with CareerOne and Amazon's AWS to support these functions. MST noted CareerOne's beta launch of AI agents was much better than anticipated, with an eight-fold improvement in job seeker matches against traditional models.
Post an $11m capital raising, Decidr is working with AWS to enhance collaboration and distribution with their 5m customers, most of which are SMEs including an estimated 100k in Australia. AWS is offering technical collaboration for Decidr's hyperscaling needs to integrate AWS software and LLM services.
In the first full quarter of commercialisation (1Q 2025), Decidr generated $1m in annual recurring revenue. Over 1800 sales enquiries were received.
MST highlights several examples across hospitality, recruitment, content creation, and merchandising where Decidr's agents have assisted businesses in achieving more cost-efficient, improved outcomes.
The stock has been given a valuation of $1.51 per share. Market capitalisation is around $60m.
More good news from Shape
Shape Australia ((SHA)) has offered another robust trading update according to Petra Capital, guiding to earnings (EBITDA) of $32m-$33m, above consensus and ahead of the broker's forecast of $29.9m-$33m, while gross margins seem to have expanded.
The pipeline remains strong at $4bn, with the newer businesses (regional, modular, and new sectors) doing well. Management did not offer updates on project wins, tendering value, and project duration in this update.
Petra assesses core revenues might be lower than forecasts, with likely offsets in other revenue and management fees. Breaking it down, the analyst estimates gross margins were around 9.5% and other revenue circa $1.5m, whereas a full contribution from core revenue would mean 2H25 gross margins of 9.9% versus 9.1% in 1H25.
The company had a net cash position of $97.6m in FY24, and the working capital cycle is viewed as positive, as the business model does not necessitate more cash and inventory as new projects are won.
Petra tweaks earnings and downgrades the stock to Hold from Buy as it trades at over a 20% premium to its peers for FY26 price-to-earnings. More details and commentary should be forthcoming at the August 20 FY25 earnings report. Target price is set at $3.60.
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