LiveHire – New agenda for growth

About the author:

Ivor Ries
Author name:
By Ivor Ries
Job title:
Senior Analyst
Date posted:
11 July 2018, 8:02 AM
Sectors Covered:
Information Technology, Online Media

Focus on better targeting of clients

We met with LiveHire's (LVH) new Managing Director and CEO, Christy Forest, who was appointed on the 12th June. While she has been in the CEO role for less than a month, she has already begun developing plans to improve the company's performance. To improve the conversion rate for potential new clients the company plans to develop better client profiling systems and more sharply focused work on integrations with third-party vendor systems.

In our view, Christy Forest has the right skill set, experience and strategy to restore the company's growth trajectory.

No change to forecasts, valuation

As LiveHire is in a reporting black-out ahead of the release of its full-year results there are no changes to our forecasts. We will revise our forecasts, valuation and share price target after the release of the annual results.

Risks and catalysts

Risks to our forecasts and the LVH share price include:

  1. new direct clients taking longer to generate revenues;
  2. global RPO clients may be slower to generate new revenues than we have forecast; and
  3. more serious competition from global HR technology groups.

Potential near-term re-rating catalysts include:

  1. LVH is successful in signing several very large clients which result in higher revenues than we have forecast;
  2. global RPO clients sign new clients and generate revenues faster than we have forecast; and
  3. major global HR technology providers integrate with the LVH system.

Investment view

LiveHire (LVH) offers investors participation in the growth of a game-changing recruitment system. Should the company be successful in implementing its strategy. the rewards for shareholders could be substantial. However, the company is an early-stage technology business and has yet to become self-sustaining from a cash-flow perspective. The stock is high risk and should be avoided by investors with a low risk profile.

As the stock trades well below our valuation and share price target, we retain our Add recommendation.

More information

Morgans clients can login to view our detailed report and updated share price target for LiveHire Limited (LVH). Alternatively, please contact your Morgans adviser or nearest Morgans office for access.

Disclaimer(s): Morgans Corporate Limited was Lead Manager for the placement of shares in LiveHire Limited and received fees in this regard.

Analyst owns shares.

The information contained in this report is provided to you by Morgans Financial Limited as general advice only, and is made without consideration of an individual's relevant personal circumstances. Morgans Financial Limited ABN 49 010 669 726, its related bodies corporate, directors and officers, employees, authorised representatives and agents (“Morgans”) do not accept any liability for any loss or damage arising from or in connection with any action taken or not taken on the basis of information contained in this report, or for any errors or omissions contained within. It is recommended that any persons who wish to act upon this report consult with their Morgans investment adviser before doing so.

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