From Morningstar: 2024-08-28 11:34:00

London Stock Exchange includes old economy companies while US has Magnificent Seven – including Endava, a tech company analysts watch. Endava offers cloud computing, software engineering, and consulting services with MasterCard and Arm Holdings as clients. Despite being undervalued at 49% discount, UK investors are cautious due to its small cap status.

Endava is unpopular with UK fund managers despite strong performance. Only two UK funds hold it in their portfolios due to liquidity risk and small market cap. Endava’s share price dropped 57.81% after revenue targets were missed by £70 million, reflecting sensitivity to wider economic shifts. It now expects fiscal-year 2024 revenue of $978.5 million to $981.13.

Endava listed on NYSE in 2018, joining a trend of UK companies favoring US markets for higher valuations and broader capital access. Other companies like Flutter and Darktrace have made similar moves. Endava specializes in digital transformation services with potential for growth in retail, automotive, and healthcare. However, competition and limited margin growth remain concerns.



Read more at Morningstar: This Tech Stock Ditched London For Wall Street. Now…