Datagate Bilgisayar (DGATE TI) - Strong bottom-line performance as expected: Maintain Buy
Net profit is in line with our expectation. Datagate posted TRY5.7m net profit in 1Q19, up by 40% y-y, in line with our estimate of TRY6.0m. No consensus estimate is available. Although the EBITDA margin was below our estimate, higher-than-expected financial income resulted in an in-line bottom-line.
A stronger 2Q ahead, BUY maintained. We deem the 1Q19 results as neutral as the net profit is in line with our forecast. However, 2Q net profit should be much stronger since the new region has started to contribute to top-line from 1 April 2019. Accordingly, we expect regional expansion to boost Datagate’s EBITDA by 178% y-y and net profit by +132% y-y in 2019. We maintain BUY on Datagate on a significant upside potential of 50%.
Datagate Bilgisayar Malzemeleri Ticaret AS. Datagate Bilgisayar Malzemeleri Ticaret AS is a Turkey-based computer and computer peripherals distributor. The Company distributes, markets and offers logistics and after-sale services for more than 1,000 computers and computer accessories of international brands, such as Seagate, Intel, Acer, Fujitsu, Belkin, Sapphire, Vestel, genius, Samsung and Transcend, among others. The Company's product portfolio includes microprocessors, hard discs, memory units, optical units, motherboards, tapes, video accelerator cards, monitors and various types of hardware supporting software. The Company distributes its products to wholesale companies and retailers. As of December 31, 2011, its main shareholder was Indeks Bilg. A.S. (59.24%).
TEB Investment equity research analysts and strategist team consists of 8 analysts with an average finance sector experience of 15 years and special focus on international investors.
With our 6 equity research analysts we cover 93 companies across 21 sectors, reflecting 80% of the total market capitalization of all BIST companies and 86% of the BIST100 companies. Our strategy team provides in depth top-down and bottom-up market views with insight on FX and bond markets by publishing sectoral and strategic reports both in English and Turkish.
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