Up 50% in a month, fundie reveals ASX micro-cap share in a ‘beautiful position’

The iCollege Ltd (ASX: ICT) share price finished in the green on Friday, up 7.7% to 21 cents. Over the past month, the ASX share has ascended 50% in value.

The micro-cap ASX share is having a great 2022 so far. While the S&P/ASX All Ordinaries Index (ASX: XAO) has been falling 12%, the iCollege share price has gained 71%. Now that’s an outperformance.

iCollege is a leading vocational education provider comprised of businesses providing accredited and non-accredited training across Australia.

In an interview on Livewire, 1851 Capital’s Chris Stott says iCollege shares are a buy.

Stott said:

This company’s in the beautiful position that they’ve got extraordinary demand for their product in the form of students coming back into the country post-COVID-19.

They can travel again, they’re having to add capacity in the form of new facilities to house a lot of these students.

So again, strong balance sheet, very well run, with the merger with RedHill not so long ago, so buy.

Stott is referring to iCollege’s off-market takeover of RedHill Education Limited in October 2021. The deal was that RedHill investors would receive 9.5 iCollege shares for every RedHill share they owned.

iCollege received 94% support from RedHill shareholders, which enabled it to compulsorily acquire the remaining shares in October 2021.

What’s news at iCollege?

iCollege released its FY22 full-year results on 29 August.

Revenue was up 187% to $46.8 million on the prior corresponding period (pcp), with RedHill contributing $31.5 million.

Its earnings before interest, tax, depreciation, and amortisation (EBITDA) went up 37%. The company said growth was “driven by [the] RedHill acquisition and recovering international student revenues”.

The company said it expected revenue and profit “to materially increase in FY23”.

This is due, in part, to student numbers exceeding pre-COVID levels, growth in bachelor degree intakes, restructuring activities, and higher campus utilisation to improve earnings.

The company has a market capitalisation of $213.59 million.

The post Up 50% in a month, fundie reveals ASX micro-cap share in a ‘beautiful position’ appeared first on The Motley Fool Australia.

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Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

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