Physitrack (Buy, TP: SEK49.00) - Pluses still outweigh minuses

We believe that Physitrack’s 25–30% organic growth remains impressive and will likely be sustained in 2023e, albeit at a somewhat lower incremental margin due to weaker mix. We understand investor scepticism until we see evidence of 1) a trough for margin contraction and cash flow improvements on a non-adjusted basis; 2) industrial logic and cross fertilisation of its M&A strategy; 3) sustained rapid organic growth in a weaker macro environment; and 4) EBITDA margin expansion towards its medium-...

Physitrack - Full throttle

Solid 28% pro forma growth driven by Wellness Opex ex. D&A up 14% q-o-q We lower ‘23e-‘24e adj. EBITA by 4-1% on higher opex

Physitrack - Strong top line driven by Virtual Wellness

Q3 top line beat but margin slightly below expectations Limited cons ‘22e adj. EBITDA revisions expected Conference call at 10.00 CEST

Physitrack (Buy, TP: SEK53.00) - Time to get back on track

We see significant upside potential in Physitrack’s stock but understand investor scepticism until we see evidence of: 1) underlying profitability and cash flow improvements on a non-adjusted basis; 2) a good business fit following the recent high pace of M&A; 3) sustained 30%+ organic growth momentum in a weaker macro environment; and 4) EBITDA margin expansion towards its medium-term 40–45% target. We have cut our 2023e adj. EBITDA and adj. EPS by 7–10%, and in turn our target price to SEK53 (...

Physitrack - Continued growth driven by Wellness

Q3e: strong on top line but slightly lower margin Minor tweaks on ‘22e-’24e top line, opex raised slightly Share is trading at 13x ‘23e EV/EBITA

Sector Fast Comment - ABGSC’s Investor Day feedback

Rovio and EG7 attended ABGSC’s Investor Day COVID-rebasing in mobile gaming to normalise soon Important changes presented by new EG7 management

Northern Lights

Physitrack (Buy, TP: SEK60.00) - Some pluses, some minuses

Physitrack again reported according to plan, with nearly 30% organic growth YOY and healthy underlying profitability, although the high pace of M&A and the numerous adjustments mean its results take time to digest. Since Physitrack’s June 2021 IPO, the adj. EBITDA per share has risen by 50%+, while our proprietary study suggests it is keeping competitors at bay. However, the share price has fallen by 10%+ since the IPO. We reiterate our BUY, but have cut our target price to SEK60 (65).

Physitrack - Delivery on track

Pro forma growth in line with company target Margin slightly pressured by virtual care acquisitions Trading at 14 ‘23e EV/EBITDA

Physitrack - Q2: 31% proforma growth

Q2: Limited deviations on sales and adj. EBITDA Small negative cons adj. EBITDA revisions expected Conference call at 10.00 CEST

Physitrack - Continuing to develop the Wellness offering

One add-on and an important partnership in Q2 Small rise in subscription sales, while lowering care The share is trading at 6.1x-5.0x EV/sales for ’22e-23e

Physitrack - Set to continue growing subscription sales

New initiatives to grow subscription sales in the pipeline Seasonality changes and adding new revenue stream Share trading at 15.5x EV/EBITDA for 2023e

Northern Lights

Physitrack (Buy, TP: SEK65.00) - Good execution; still attractive

Physitrack continues to deliver on its ambitious profitable-growth strategy, as it reported 67% revenue growth YOY (of which 25%-points was organic) and a 17% adj. EBIT margin in Q1. We saw little in the report to change our view but have lowered our 2022–2023e adj. EBIT by 2% on higher opex. We are encouraged by improved retention rates in its B2B physiotherapy SaaS offering. As the investment community should gain more proof points in 2022–2023e that Physitrack can successfully bundle and driv...

Physitrack - Continues to increase the subscriber base

Q1 sales of EUR 2.6m (-5.7% vs ABGSC) The number of subscribers +17% y-o-y (vs ABGSC 21%) Expect relatively small forecasts changes

Physitrack - All set for strong growth to continue

Physitrack stays strong despite external disruptions We add Champion Health to the figures Share trades more than 40% below Nordic SaaS peers

Northern Lights

Physitrack (Buy, TP: SEK65.00) - Pedal to the metal

Ahead of Physitrack’s Q1 results, we have raised our 2022–2023e adj. EBITDA by 1–5% in light of recent acquisitions, which we see as highly strategic, and as solidifying Physitrack’s early market-leading position in B2B physiotherapy software and wellness. We expect it to maintain its strong, profitable growth with 68% net sales growth YOY (of which 31% is organic) in 2022 at a 33% adj. EBITDA margin. In the coming quarters, we believe this should propel the share price towards our new SEK65 (87...

Physitrack - Enhances its holistic care offering

Acquires a leading digital workplace health platform Adding (at least) 3.2% to sales in ’22e Pays 7.3x EV/sales, based on run rate sales of EUR 0.4m

Strategy Fast Comment - Summary of ABGSC Investor Days, 8-9 March

38 companies presented at the seminar Mostly Swedish small caps attending See links to all company recordings