Argus Research Initiates Equity Research Report Coverage on ASBISc Enterprises PLC


ASBISc has grown revenues and earnings in recent years, and is well positioned for continued growth. The company has expanded its gross margin by more than 100 basis points over the past two years, supported by strong sales of private-label products, distribution efficiencies, and the increased use of e-commerce. We believe that ASBISc warrants a valuation closer to the industry average. Applying a slightly below-peer-average multiple of 15 to 2020 EPS of 2.51, we arrive at a fair value estimate for ASB of approximately 39 PLN per share ($10), well above current prices near 17.20 PLN ($4.36). 


Although the pandemic caused widespread industry disruption in 2020, leading many businesses to close, ASBISc was able to meet customer needs for digital and remote connectivity technologies. We believe this is reflected in the company’s positive revenue growth in all four quarters of 2020, including the difficult second quarter, when revenue rose 2%. In our view, the subsequent 34% growth in 3Q and 30% growth in 4Q highlight the resiliency and underlying strength of ASBISc’s business. 

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