GB Group (LON:GBGP) outlook remains strong; the bulk of revenues are now from the faster-growth international service lines, investment in growth is increasing and we see its strength in dynamic ID verification (IDV) as increasingly relevant. We forecast 15% CAGR in EPS to 2020 and see scope for GBG’s active M&A strategy to act as a catalyst to further earnings and share price upside.
Well positioned in increasingly dynamic IDV industry
GBG has made five acquisitions over the last three years, widening its reach and tilting the group structure towards the three divisions with immediate global potential. Around 75% of revenues are now generated from its faster-growing international product sets: registering identities, managing risk and fighting fraud. It has also positioned itself as one of the few vendors that is able to offer a more dynamic verification service, something that we see as increasingly important given the frequency of data breaches and prevalence of identity fraud.
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