1) Pushpay ( $PPH ): LT Winner at an Attractive Price

Exec Sum:

- Clear leader in faith-based giving capitalizing on digital adoption
- Strong value prop for customers with LT moat against comps
- Solid top-to-bottom financial growth and attractive current create
2) Variant View & WYNB:

- Recent mgmt. turnover has caused doubt amongst investors but will not impede operational / financial success in LT
- Market opp will remain significant and PPH will remain clear leader
- Potential for US-based listing driving recognition and volume
3) Biz Description:

Founded in 2011, PPH is a digital donation platform and a church management system for churches. The Co makes revenue through processing fees (~72% LTM) on giving and subscription fees (~28% LTM) for its engagement tools and targets mid-to-large churches.
4) Thesis:
(i) Capitalizing on Structural Shift Toward Digital Donations and Engagement:

Makes giving frictionless and drives engagement in a time of digital transformation and megachurch growth. Clear leader in immediate TAM (>$1.5Bn) with significant expansion optionality
5) Thesis (cont'd)

(ii) Clear Value Prop & Best-in-class Product Offering:

Helps churches increase donation revenue (10%+ on avg), expand congregation engagement & reach (est. to reach 3x weekly in-person attendance) and increase clergy & admin time and cost savings
6) Thesis (cont’d)

(iii) LT Defensible Moat:

Moat around sticky customer base (58/100 largest churches in US and 93%+ retention), ecosystem advantage (only full-scale comprehensive solution in faith tech industry) and brand trustworthiness (most well-known and trusted partner)
7) Financial Highlights:

- Revenue: ~90% CAGR FY16-20A, ~43% on LTM basis
- High Op Lev: ~4%, ~22% and ~29% EBITDA margins in FY2019A,’20A and on LTM basis, respectively
- ~14% and ~23% UFCF margins in FY20A and on LTM basis, respectively
8) Directional Create (one FY out (FY22E), conservatively):

- ~5-7x Revenue
- 14-16x Adj. EBITDA
- 21-23x UFCF
- Double digit top-to-bottom line growth expected in NT (growth assumptions still dampened compared to LTM, likely to be higher)
- Discount deepens in farther out years
9) Risks & Mitigants:

- Pricing pressure (PPH charges a premium to competitors and will to continue to have pricing power due to leading and extremely sticky offering)
- Declining church attendance ((digital) giving is rising, giving and attendance are uncorrelated)
10) Risks & Mitigants (cont’d):

- Mgmt. turnover & insider selling: Recent turnover / turmoil has in part given rise to attractive price and will not operationally impede PPH's success in LT. Conviction needs to be formed around new CEO and board members driving key initiatives
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