On Thursday, Multitude will report Q1´24 figures that should come in solid, but with room for sequential improvements until YE. Here is what to expect:

• Sales should come in at € 59m (+9% yoy, -6% qoq), mainly driven by the strong growth of the net loan book (NAR) to € 636m in FY23 (including c. € 576 loan to customer and c. € 60m attributable to warehouse lending) unfolding its full effect in Q1. We expect ferratum to have contributed some 84%, CapitalBox 13% and the new segment wholesale banking 3% to total sales.
• EBIT is anticipated at € 10.3m (+7% yoy, -16.3% qoq), following the higher topline and rather stable S&M expenses and personnel expenses as well as other operating expenses, compensating for impairments on loans (19% yoy, -15% qoq), that should come in higher than in Q1´23 due increased loan book. As interest expenses should should have increased by c. 10% yoy to € 7.7m (eNuW; -1% qoq), EBT should come in at € 2.8m (-4% yoy).

While our estimates for Q1 imply a solid yoy growth in a challenging economic phase, further significant sequential improvements throughout the year are necessary to reach the FY24 EBIT guidance of € 67.5m (vs eNuW: € 57m). In our view, the guidance looks ambitious, but is not out of range assuming 1) further growth of the loan book, partially materializing throughout the remainder of 2024, 2) the strong growth momentum of CapitalBox as well as 3) opportunities around the new segment wholesale banking that already gained traction in FY23. That, paired with ongoing tight cost control, that the company already showed in FY23, unlocking scale effects (assuming ongoing topline growth as a result of the growing loan book and stable margins) as well as the fact that Multitude reached its guidance for the 3^rd consecutive year in FY23 give us additional confidence.

As the stock is still trading at negative EV and a 3.4x PE´24, the growing, highly profitable, resilient and dividend paying company to look undebatable cheap.

BUY with an unchanged PT of € 12 PT, based on our residual income model. Mind you that Multitude is one of our NuWays' Top Picks for FY24.