CLOSE THE LOOP LIMITED (CLG)
Share Price Analysis and Chart

10/10/2024

1

Buy

$0.60

233.33%

Shaw and Partners explains the potential for Close the Loop to refinance its high-cost, senior secured debt facility would support the view the international banking syndicates have confidence in the company's IT refurbishment business.

The broker notes the refinancing is unlikely to lower short-term interest costs due to fees from retiring existing debt. It would impact from FY27.

At the upcoming Nov 21 AGM, the analyst anticipates a trading update from management and quantitative earnings guidance for FY25.

Buy rating. High risk, with a 60c target.

FORECAST
Shaw and Partners forecasts a full year FY25 dividend of 0.00 cents and EPS of 4.80 cents.
Shaw and Partners forecasts a full year FY26 dividend of 0.00 cents and EPS of 5.10 cents.

04/09/2024

1

Buy

$0.53

194.44%

Close the Loop posted revenue and earnings that were in line with expectations and guidance. Canaccord Genuity suspects that net debt, which increased by $16m in the June half year, was the main driver of the drop in the share price.

The broker believes the business should be able to convert closer to 90% of EBITDA into cash noting the shares continue to trade at very low multiples.

Buy rating is retained as the current valuation appears to compensate investors for the risk in the business. Target is reduced to $0.53 from $0.65.

FORECAST
Canaccord Genuity forecasts a full year FY25 dividend of 0.00 cents and EPS of 5.10 cents.
Canaccord Genuity forecasts a full year FY26 EPS of 6.10 cents.