NuWays AG Recommends Buying NFON AG Shares

NFON AG has shown strong Q1 results, indicating ongoing operational improvements. The company's recurring revenue rose by 2.8% year-over-year to €19.9 million, maintaining a high ratio of 93.6%. Total sales reached €21.1 million, driven by a 2% increase in the seat base to 659,000 and successful cross-selling of premium solutions. The blended ARPU slightly improved to €9.82.

Profitability also saw a notable boost. Adjusted EBITDA increased by 43% year-over-year to €2.8 million, facilitated by minor enhancements in gross margin and reduced personnel and other operating expenses. Q1 EBIT was reported at €0.7 million, with a positive FCF of €0.2 million.

Management reaffirmed the full-year guidance, expecting recurring revenue growth in the mid- to upper-single-digit percentages and an adjusted EBITDA ranging between €10-12 million. The integration of DTS is projected to yield significant synergies in the second half of the year.

NuWays AG maintains a "Buy" recommendation with a target price of €11.70, highlighting NFON's attractive valuation.