Research Analyst, AlphaBox Advisors

Vijay Lohia, CFA

Research Analyst

Value-Investing Philosophy and Bottom-up Approach

AlphaBox Advisors

At AlphaBox, our recommendations are sector and country agnostic and diversified by market cap. We follow value-investing philosophy and pursue a bottom-up approach to recommending stocks that has a good risk-reward profile and potential to generate market-beating returns, which in some cases would be complemented with an attractive dividend yield. Our recommendations fall into the following two broad categories: (i) Long-term Compounders – Global Markets (ii) EM and FM Alpha

Event-Driven

<ul>
<li>Overall, the sentiments are extremely negative with most sell-side analysts having a Sell/Neutral rating on the stock.</li>
<li>We believe either A) Revenue and earnings growth will pick up under the new management team, or B) Temenos will be taken over by some private equity firm.</li>
<li>While revenue growth has remained subdued, the company’s moat remains intact in our view.</li>
</ul>


Overall, the sentiments are extremely negative with most sell-side analysts having a Sell/Neutral rating on the stock.
We believe either A) Revenue and earnings growth will pick up under the new management team, or B) Temenos will be taken over by some private equity firm.
While revenue growth has remained subdued, the company’s moat remains intact in our view.


Temenos (TEMN SW): World's No.1; Improving Fundamentals; M&A Candidate

Owner and CEO, GR20 Research

Gregory Ramirez

Owner and CEO

Industry Research and Consulting Services

GR20 Research

GR20 Research provides industry research and consulting services

Equity Bottom-Up

<ul>
<li>The sale of Multifonds at a low EV/EBIT multiple of 8.0x reflects Montagu's use of a higher multiple based on adjustments to EBITDA, pointing out modest free cash flow contribution.   </li>
<li>Considering the sale, Temenos revised 2028 targets, reducing ARR, operating profit, and free cash flow projections accordingly. Investors are looking for more transparency on how these changes affect operating margin.   </li>
<li>Temenos’ shift from total software licensing breakdowns to a unified subscriptions/SaaS line, alongside complex revenue recognition rules, adds to investor uncertainty about how to assess the future revenue structure.</li>
</ul>


The sale of Multifonds at a low EV/EBIT multiple of 8.0x reflects Montagu's use of a higher multiple based on adjustments to EBITDA, pointing out modest free cash flow contribution.   
Considering the sale, Temenos revised 2028 targets, reducing ARR, operating profit, and free cash flow projections accordingly. Investors are looking for more transparency on how these changes affect operating margin.   
Temenos’ shift from total software licensing breakdowns to a unified subscriptions/SaaS line, alongside complex revenue recognition rules, adds to investor uncertainty about how to assess the future revenue structure.


Temenos (TEMN SW): Trying to Solve the Modelling Puzzle

Thematic (Sector/Industry)

<ul>
<li>Software companies see a slow improvement in revenue growth, with Europe narrowing the performance gap. However, growth remains below post-lockdown levels, and a return to high double-digit rates is unlikely.  </li>
<li>The best-performing vendors are those focused on defence, large-scale data handling, AI infrastructure, cybersecurity, financial services digitisation, and modern accounting platforms. US firms still lead in absolute growth numbers.   </li>
<li>While the number of software M&amp;A deals above USD 200m has declined, total deal value is on track for a record year in 2025, driven primarily by strategic acquirers.</li>
</ul>


Software companies see a slow improvement in revenue growth, with Europe narrowing the performance gap. However, growth remains below post-lockdown levels, and a return to high double-digit rates is unlikely.  
The best-performing vendors are those focused on defence, large-scale data handling, AI infrastructure, cybersecurity, financial services digitisation, and modern accounting platforms. US firms still lead in absolute growth numbers.   
While the number of software M&amp;A deals above USD 200m has declined, total deal value is on track for a record year in 2025, driven primarily by strategic acquirers.


European Software: Q1 2025 Takeaways – Gradual Improvement

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Our outlook remains bullish on MSCI ACWI. Discussed in Jan9,2025 report how we viewed the pullback as a buying opportunity and were watching for $116-$117 support to hold on ACWI-US. </li>
<li>$116 support held perfectly, and now both ACWI-US and the S&amp;P 500 are coiling just below all-time highs, likely setting up for major breakouts. ACWI is now breaking out.</li>
<li>DXY and 10-Year Treasury yield are both topping, a crucial risk-on signal for global equities. More and more countries breaking out. Actionable Themes: Technology, Services, Communications, Industrials, Gold Miners, Financials</li>
</ul>


Our outlook remains bullish on MSCI ACWI. Discussed in Jan9,2025 report how we viewed the pullback as a buying opportunity and were watching for $116-$117 support to hold on ACWI-US. 
$116 support held perfectly, and now both ACWI-US and the S&amp;P 500 are coiling just below all-time highs, likely setting up for major breakouts. ACWI is now breaking out.
DXY and 10-Year Treasury yield are both topping, a crucial risk-on signal for global equities. More and more countries breaking out. Actionable Themes: Technology, Services, Communications, Industrials, Gold Miners, Financials


More Countries Breaking Out; Bullish Outlook Intact; Buys in China, Europe, More; DXY & Yields Top

External broker reports(aggregated public sources), Topline Securities

Topline Securities

External broker reports(aggregated public sources)

Topline Securities is one of the fastest growing brokerage houses in Pakistan. It has strong equity brokerage, economic / equity research, mutual fund distribution, commodity trading and corporate finance & advisory functions. Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research.</li><li>Temenos Chairman who is also the Chair of the Audit Committee, fundamentally refutes the report published by Hindenburg Research and has assured that Temenos is running a very sound business.</li><li>The Chairman also informed that the Board is going to hire a top independent third-party consultant in order to address these allegations. Once the whole examination is completed, he will come back with more detail answer.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research.Temenos Chairman who is also the Chair of the Audit Committee, fundamentally refutes the report published by Hindenburg Research and has assured that Temenos is running a very sound business.The Chairman also informed that the Board is going to hire a top independent third-party consultant in order to address these allegations. Once the whole examination is completed, he will come back with more detail answer.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Pakistan Technology: Temenos Capital Markets Day – Key Takeaways; Systems Limited – “Buy Maintained”

Switzerland

Temenos AG provides integrated software solutions. The Company offers analytics, channels, financial crime mitigation, funds and securities, risk and compliance, and front office and digital banking suits for the management of administrative tasks at banks and financial services companies. Temenos operates worldwide.

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Temenos AG (TEMN SW)

Temenos (TEMN SW): World's No.1; Improving Fundamentals; M&A Candidate

World's No.1 Banking Software giant available at attractive valuations. With recent management changes, either earnings growth will pick up, or it...

Vijay Lohia, CFA

Temenos (TEMN SW): Trying to Solve the Modelling Puzzle

Montagu's sale of Multifonds at low multiple prompts Temenos to revise targets, causing investor uncertainty over revenue structure and operating...

Gregory Ramirez

European Software: Q1 2025 Takeaways – Gradual Improvement

Software companies in Europe are closing the revenue growth gap with the US. M&A deals above $200m are declining, but total deal value is set for...

Gregory Ramirez

More Countries Breaking Out; Bullish Outlook Intact; Buys in China, Europe, More; DXY & Yields Top

More Countries Breaking Out; Bullish Outlook Intact $ACWI $EAFE $EEM. More buys in China; Germany continues to lead Europe higher. Will...

Vermilion Research

Pakistan Technology: Temenos Capital Markets Day – Key Takeaways; Systems Limited – “Buy Maintained”

Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research. Temenos Chairman who...

Topline Securities

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Temenos (TEMN SW): World's No.1; Improving Fundamentals; M&A Candidate

World's No.1 Banking Software giant available at attractive valuations. With recent management changes, either earnings growth will pick up, or it...

Vijay Lohia, CFA

Temenos (TEMN SW): Trying to Solve the Modelling Puzzle

​Montagu's sale of Multifonds at low multiple prompts Temenos to revise targets, causing investor uncertainty over revenue structure and operating...

Gregory Ramirez

European Software: Q1 2025 Takeaways – Gradual Improvement

​Software companies in Europe are closing the revenue growth gap with the US. M&A deals above $200m are declining, but total deal value is set for...

Gregory Ramirez

More Countries Breaking Out; Bullish Outlook Intact; Buys in China, Europe, More; DXY & Yields Top

More Countries Breaking Out; Bullish Outlook Intact $ACWI $EAFE $EEM. More buys in China; Germany continues to lead Europe higher. Will...

Vermilion Research

Pakistan Technology: Temenos Capital Markets Day – Key Takeaways; Systems Limited – “Buy Maintained”

Temenos held its Capital Markets Day on Feb 20, 2024, where management addressed the allegations made by Hindenburg Research. Temenos Chairman who...

Topline Securities

Montagu's sale of Multifonds at low multiple prompts Temenos to revise targets, causing investor uncertainty over revenue structure and operating...

Software companies in Europe are closing the revenue growth gap with the US. M&A deals above $200m are declining, but total deal value is set for...