paragon

DE: PGN

€82.3m market cap

€18.18 last close

paragon designs and supplies automotive electronics and solutions, selling directly to OEMs, including sensors, interiors, digital assistance and body kinematics. Production facilities are in Germany, the US and China. Following the IPO in October 2017, paragon owns 60% of Voltabox.

Investment summary

Despite challenges for the auto market, FY19 guidance is for sales and EBIT growth of c 25% driven primarily by electromobility and digitalisation, with all operating segments contributing. paragon’s continued organic investment augmented by strategic M&A, positions it to take advantage of identified growth trends. Having delivered FY18 and despite tempering our forecasts modestly for FY19, guidance still indicates strong growth, especially at Voltabox. Q119 results do nothing to deflect the expectation. On our new lower estimates, the rating fails to reflect the growth potential.

Y/E Dec
Revenue (€m)
EBITDA (€m)
PBT (€m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2017A 124.8 18.3 5.9 (8.52) N/A 102.3
2018A 187.4 30.3 14.8 144.58 12.6 N/A
2019E 240.2 38.6 18.8 241.14 7.5 1.7
2020E 295.3 47.0 24.3 299.33 6.1 2.4
Last updated on 25/07/2019
Industry outlook

We believe paragon’s identification of, and investment in, solutions to address megatrends in global automotive and electromobility markets is understood by the capital markets. It is growing substantially faster than its markets due to innovative products that are driving changes in customer perceptions, creating new growth engines for the group.

Last updated on 25/07/2019
Sector
Industrials
Share price graph
Balance sheet
Forecast net debt (€m) 72.6
Forecast gearing ratio (%) 34
Price performance
%
1m
3m
12m
Actual (12.8) (42.5) (59.6)
Relative* (13.7) (42.8) (58.9)
52-week high/low €47.9/€15.1
*% relative to local index
Key management
Klaus Frers CEO

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