Alignment of technical and fundamental analysis
CBRAIN cBrain is a software solution company based in Denmark. The company provides solutions to governments and communes for administration and governance.
Here is a fun fact, Denmark is one of the top countries in digital governence in the world. cBrain has collaborated with Danish government and build their software solutions from the ground up, so you can imagine how good and relevant their product can be.
The software, known as "F2" does ...
As far as I know, there are very few competitors who can play at their level. The company operates in one of the larget addressable market "Digital governance"..
So, how does the financial look?
There revenue has almost double every 3 to 4 years since 2013
Why?
There are quite a for such a fantastic performance.
1. Unique position in market
- Their software is built from the ground up in collaboration with danish government. That means their products are highly relevant. they onboarded at least 50 different departments so far..
- Traditional software take (delivery and cash flow).. they invested heavily initially, but then the product was developed it offered based on subscription.
- There is an interesting video from Management of the company, where the CEO XXX talks about the similarities between various governments.
- He says that they have talked with governments of various countries and found out that they more or less operate the same. That opens up a whole new export market at another level.
- The software industry is not so much capital intensive, so ultimately it leads to high-profit margin.
- Looking at annual reports their client countries are a good mix or developed as well as emerging economies and they have not had any difficulties in collecting cash.
The governments will continue to operate that means an almost predictable and recurring stream of revenue.
cBrain started exporting their solutions and since then their export has only grown. Now they make up of 48% of revenue, which points towards broader customer base.
The company is also introducing new software F2 for climate, adding another product to income stream.
In conclusion, cBrain has a strong cash flow and balance sheet and because of its unique position in market it is only bound to grow.
That is all about fundamental analysis
Technical Analysis :
Remember, you are not the only one who can read the annual reports and conclude this. That brings us to another dimention of investing "timing". All stocks go through 4 phase,..
As of not cBrain stock has rallied very high, beating the market average during post covid rally. This is one of the indicators of "leading stocks" in stock market, where during the bull run they often beat the market.
However, such stocks are bound to correct as well, which it has now. After a period of 6 month consolidation, it has broken out of consolidation with high "volume" and "tennis ball" price action. Hence a great opportunity to invest.
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