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(Sharecast News) - Analysts at Berenberg cut their target price on software firm Boku from 300p to 200p on Monday as they reduced their forecasts following a weakerthanexpected firsthalf update, though they also said their investment thesis remained intact and reiterated their 'buy' recommendation.
Boku warned that FY26 revenue and profits would be materially lower than consensus due to three operational headwinds, prompting cuts to revenue forecasts of 10%, 16% and 20% for FY26-28, and to adjusted underlying earnings estimates of 22%, 27% and 30%, respectively.
In H1, Boku said total payment volume came in at $8.3bn, below the $9.2bn consensus, though still up around 12% yearonyear, as the firm said its performance was held back by a key merchant shifting to dual sourcing in one major region, the suspension of two direct carrier billing connections in another market, and delays to merchant onboarding and new connection launches. Revenues rose 5% to $66.5m, below the $72.1m consensus, while adjusted EBITDA came in at $19.3m, missing expectations of $23.2m.
Boku now expects FY26 revenues of $135m to $142m, versus the $155m consensus, implying yearonyear growth of 5 to 10%, while adjusted EBITDA was forecast to be $38m to $42m, compared with $49.6m expected.
Berenberg said strategic progress continued in H1, highlighting Boku's contract with Stripe as a potential source of significant incremental volume. It added that the lower end of guidance reflected a "worstcase" scenario, making the recent shareprice fall an attractive entry point.
The German bank added that Boku now trades on a 18.3x FY26 price-to-earnings ratio (excash) and a 4.1% FY26 freecashflow yield.
Shore Capital has reiterated its 'buy' rating on RWS Holdings, saying that last month's sell-off shows that the market is not pricing in the progress that the AI solutions business has made over the first half.
Results for the six months to 31 March, released on 11 June, were met with a sharp drop in the shares, from 102.7p to the current 76-77p mark.
According to Shore Capital, the interim results showed "clear evidence that RWS's refreshed strategy is beginning to work", though the market remains concerned that a recovery is still incomplete, while the Transform division remains a "key drag", the broker added.
"Exceptional costs, FX headwinds, and the rebased dividend also temper near-term free cash flow progress, while investors continue to debate the longer-term competitive impact of AI on RWS' core model," it said.
Nevertheless, Shore Capital said it still sees "meaningful upside" if RWS can stabilise the Transform business, increase software penetration and convert its AI/product capability into a more recurring, higher-margin revenue.
"RWS' H1 results were followed by a sharp share price sell-off, leaving an already inexpensive business looking increasingly disconnected from the evidence of operational progress," the broker said. "Risks are more than priced in, in our view, and we believe further evidence of sustained positive Group organic growth, an improving software/AI mix, stronger cash conversion and disciplined capital allocation should help rebuild confidence. We retain our 'buy' recommendation."