ASX:8CO

Stock Analysis Report

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Executive Summary

8common Limited develops and distributes software solutions in Australia, Asia, and North America.


Snowflake Analysis

Flawless balance sheet and overvalued.

Share Price & News

How has 8common's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: 8CO has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-4.2%

8CO

1.7%

AU Software

1.9%

AU Market


1 Year Return

-42.5%

8CO

8.5%

AU Software

-8.4%

AU Market

Return vs Industry: 8CO underperformed the Australian Software industry which returned 8.2% over the past year.

Return vs Market: 8CO underperformed the Australian Market which returned -8.3% over the past year.


Shareholder returns

8COIndustryMarket
7 Day-4.2%1.7%1.9%
30 Day-1.4%1.9%1.7%
90 Day21.1%9.4%13.2%
1 Year-42.5%-42.5%9.4%8.5%-4.6%-8.4%
3 Year98.1%81.6%118.3%109.2%19.4%3.7%
5 Year-66.2%-69.3%139.7%121.5%39.5%9.4%

Price Volatility Vs. Market

How volatile is 8common's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is 8common undervalued compared to its fair value and its price relative to the market?

2.24x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: 8CO (A$0.07) is trading above our estimate of fair value (A$0.05)

Significantly Below Fair Value: 8CO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: 8CO is unprofitable, so we can't compare its PE Ratio to the AU Software industry average.

PE vs Market: 8CO is unprofitable, so we can't compare its PE Ratio to the Australian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate 8CO's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: 8CO is good value based on its PB Ratio (2.2x) compared to the AU Software industry average (4x).


Next Steps

Future Growth

How is 8common forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

37.7%

Forecasted Software industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as 8common has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has 8common performed over the past 5 years?

-12.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 8CO is currently unprofitable.

Growing Profit Margin: 8CO is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: 8CO is unprofitable, and losses have increased over the past 5 years at a rate of 12.8% per year.

Accelerating Growth: Unable to compare 8CO's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: 8CO is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (18.6%).


Return on Equity

High ROE: 8CO has a negative Return on Equity (-14.03%), as it is currently unprofitable.


Next Steps

Financial Health

How is 8common's financial position?


Financial Position Analysis

Short Term Liabilities: 8CO's short term assets (A$1.7M) exceed its short term liabilities (A$1.1M).

Long Term Liabilities: 8CO's short term assets (A$1.7M) exceed its long term liabilities (A$76.5K).


Debt to Equity History and Analysis

Debt Level: 8CO is debt free.

Reducing Debt: 8CO has no debt compared to 5 years ago when its debt to equity ratio was 28.9%.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: Whilst unprofitable 8CO has sufficient cash runway for more than 3 years if it maintains its current positive free cash flow level.

Forecast Cash Runway: 8CO is unprofitable but has sufficient cash runway for more than 3 years, even with free cash flow being positive and shrinking by 11.9% per year.


Next Steps

Dividend

What is 8common current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate 8CO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate 8CO's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if 8CO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if 8CO's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of 8CO's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.7yrs

Average management tenure


CEO

Andrew Bond

0.92

Tenure

AU$232,053

Compensation

Mr. Andrew Bond has been the Chief Executive Officer at 8common Limited since September 1, 2019 and served as its Chief Operating Officer until September 1, 2019. Mr. Bond joined 8common in August 2015 and ...


CEO Compensation Analysis

Compensation vs Market: Andrew's total compensation ($USD166.51K) is below average for companies of similar size in the Australian market ($USD270.56K).

Compensation vs Earnings: Insufficient data to compare Andrew's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Kah Lim
Founder & Executive Chairman4.58yrsAU$150.00k14.53%
A$ 1.8m
Andrew Bond
Chief Executive Officer0.92yrAU$232.05k0.016%
A$ 2.1k
Zoran Grujic
Chief Financial Officer1.83yrsAU$63.80k1.49%
A$ 188.2k
Rory Koehler
Chief Technology Officer3.42yrsAU$154.46k0.016%
A$ 2.1k
Ben Brockhoff
Chief Operating Officer0.92yrno datano data
Dean Jagger
Company Secretary1.67yrsno datano data

1.7yrs

Average Tenure

Experienced Management: 8CO's management team is not considered experienced ( 1.7 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Kah Lim
Founder & Executive Chairman4.58yrsAU$150.00k14.53%
A$ 1.8m
Nyap Gan
Non-Independent Non-Executive Director6.42yrsAU$25.00k7.77%
A$ 981.2k
Kok Fui Lau
Alternate Director0.17yrno data5.12%
A$ 645.7k
Adrian Bunter
Independent Non-Executive Director6.17yrsAU$25.00k0.036%
A$ 4.6k
John Du Bois
Independent Non Executive Director1.83yrsAU$16.66k0.18%
A$ 22.7k

4.6yrs

Average Tenure

51yo

Average Age

Experienced Board: 8CO's board of directors are considered experienced (4.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: 8CO insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 17.3%.


Top Shareholders

Company Information

8common Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: 8common Limited
  • Ticker: 8CO
  • Exchange: ASX
  • Founded: 2014
  • Industry: Application Software
  • Sector: Software
  • Market Cap: AU$12.621m
  • Shares outstanding: 182.92m
  • Website: https://www.8common.com

Location

  • 8common Limited
  • 383 George Street
  • Level 2
  • Sydney
  • New South Wales
  • 2000
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
8COASX (Australian Securities Exchange)YesOrdinary SharesAUAUDAug 2014
8COCHIA (Chi-X Australia)YesOrdinary SharesAUAUDAug 2014

Biography

8common Limited develops and distributes software solutions in Australia, Asia, and North America. It offers Expense8, a travel and expense management software solution that manages and streamlines the end ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/08/08 10:34
End of Day Share Price2020/08/07 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.