ASX:SLC
Superloop Ltd
Investment Summary
The fund managers believe that Superloop Ltd (SLC) is well-positioned for growth in the telecommunications sector. They highlight the company's recent collaboration with Origin Energy, which signed 150,000 broadband customer accounts, demonstrating faster growth than consensus expectations. In their opinion, SLC's plug-and-play wholesale offering enhances its pricing power in residential broadband services, allowing it to compete effectively against larger incumbents. Despite a 5.3% decline in July, the fund managers note this was primarily due to profit-taking after a strong June, where SLC's share price rallied 14%. They assert that the long-term impact of the Origin Energy partnership will be a key driver of earnings growth over the next 2-3 years. Overall, they regard Superloop as the best-positioned challenger telco in the market.
Commentary From The Managers
Endeavor Asset Management
31 July 2024
$1.52
- Superloop (SLC) share price declined by 5.3% in July, slightly better than peer Aussie Broadband (ABB) at 7.8%.
- In June, SLC's share price increased due to positive trading updates and a new partnership with Origin Energy.
- July saw profit-taking among some investors.
- Endeavor Asset Management believes the market is underestimating the importance of the Origin Energy deal.
- This partnership is expected to be a key driver of earnings growth for Superloop over the next 2-3 years.
- Endeavor Asset Management continues to hold because they see significant potential in SLC's future earnings.
Endeavor Asset Management
30 June 2024
$1.56
- Superloop Ltd (SLC) experienced a strong month with a 14% increase in share price.
- New partnership with Origin Energy, which recently signed 150,000 broadband customer accounts.
- Origin's growth exceeds consensus expectations when compared to December figures.
- Superloop upgraded FY24 EBITDA guidance to at least $53 million.
- Capex guidance reaffirmed by Superloop.
- Endeavor Asset Management continues to see Superloop as the best-positioned challenger in the telecommunications sector.
- The company’s plug-and-play wholesale offer enhances pricing power in residential broadband services.
Endeavor Asset Management
31 May 2024
$1.41
- Endeavor Asset Management has reallocated part of its position from Aussie Broadband (ABB) to Superloop (SLC), now holding both investments.
- Superloop serves as a telecommunications infrastructure provider.
- The fund manager anticipates continued network expansion for Superloop.
- Expectations include gaining customers from large incumbent competitors.
- Endeavor also foresees new wholesale customer deals for the company.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.