EOH: the jury’s still out
The IT company is not doing enough to share its strategy with the market at a time when it is under greater scrutiny
That technology group EOH spent much of its interim results presentation last week harping on about the media’s "adverse, unfounded" coverage did not go down well with a skittish market. After all, investors are anxious for greater clarity on the company’s financials and business practices after a 70% slump in its share price over the past two years. EOH’s shares sank a further 10% in the two days after its presentation, and Courtney Capital’s Mark du Toit says the clarity that the market wants, especially on the split between acquisitive and organic growth, remains elusive. That split is especially important now, given that the company’s depressed share price may hamstring it in launching earnings-moving deals. Those have been key in its until recently unstoppable expansion, in which annual profits grew at between 30% and 40%. "They gave the same answer they’ve always given — that they can’t give us a split [between acquisitive and organic growth], but it wouldn’t hurt to disclose ...
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