Having problems managing your SAP licenses and authorizations? There is a simple solution: VOQUZ Labs AG. As THE specialist for SAP software asset management, the company provides a comprehensive product portfolio built around its core solution samQ which supports customers in efficiently managing their SAP licenses and authorizations. In contrast to more generalist peers, VOQUZ is the only player in the market, that exclusively focusses on SAP, enabling a significant knowledge advantage. In fact, VOQUZ developed a unique database over the past years, featuring over 100,000 SAP transactions, enabling maximum precision in the license measurement process.

Speed matters. While IT projects usually take up to one year and in certain cases even longer, VOQUZ is able to execute much faster: first results are being delivered within only a couple of days. Via the so called “Quick License Assessment”, customers receive a one-time full assessment of their SAP landscape after just four meetings with a VOQUZ consultant.

This is a strong value proposition. With the support of VOQUZ, customers are not only relieved of the laborious process of determining the number of licenses needed and managing their authorizations. Rather, they are likely able to significantly cut their annual SAP spend thanks to VOQUZ’ state-of-the-art software suite, thus creating strong ROIs. For example, JetBlue was able to cut the number of licenses in half leading to a multi-million dollar saving.

It is therefore not surprising that VOQUZ faces strong and accelerating demand (order intake +21% yoy) as companies currently take a closer look at IT budgets in the light of recessionary fears. Going forward, the mandatory transition to SAP S/4HANA is seen to provide further upside. Supported by a marketing push and the roll-out of new products, we hence expect sales to grow dynamically at a 30% CAGR to € 14.2m (2021-26e) and EBIT to expand by 49% annually to € 4.6m, thanks to an increasing share of recurring revenues and scale effects. In fact, recurring revenues are set to reach >70% of total revenues and ROCE to approach 40% already by 2024e demonstrating strong business quality in the form of visibility and value creation.

Along with several growth opportunities and a highly scalable business model, the stock looks undervalued trading at 8.6x EV/EBITDA 2023e. We hence initiate with BUY and a € 32.00 PT based on DCF.