Asset Manager Investing in Global Technology Sector

We're an asset management firm allocating our capital into asset classes benefiting from technological innovation and applications globally. We serve as a family office of a tech professional who has spent over a decade as an entrepreneur, operator, and venture investor across Asia and the US.

Our small team is made up of diverse investment professionals who research, identify, and execute relevant opportunities. We occasionally share some of our investment memos, insights, and analysis here.

Wednesday, May 13, 2020

Q2.2020 - Temenos: Attractive SaaS Opportunity At A Discount

Well-known for its on-premise software solution for top-tier banks, Temenos' (OTCPK:TMSNY) SaaS performance has exceeded our expectations. In Q1 2020, the segment grew by a staggering 79% YoY despite the COVID-19 disruption that has slowed down the go-to-market activities and eventually the stock’s performance. The stock is currently down 7% from the ~$145 level in October 2019 when we covered the stock the first time. However, the company’s growth story has not changed since then, as we continue to see more validations of our bull thesis. Since our first coverage, its share price had appreciated by ~17% by February 2020. Without the COVID-19 impact, it is highly likely that the run would have continued. As a result, the current price level creates an attractive entry point opportunity for investors.

Despite the COVID-19 disruption on sales and onboarding activities, SaaS revenue grew by 79% YoY in Q1. The growth narrative in Temenos has not changed, as it will still benefit from the digital banking trends given its strong focus in R&D. The stock is currently down 25% from the YTD-high in February 2020, creating an attractive entry point to pick it up at a bargain.

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