ReadyTech Holdings Limited (ASX: RDY)Share Price and News
About ReadyTech
ReadyTech is a leading player in the Australian SaaS industry, delivering critical software solutions to businesses and institutions across the education, workforce, and government sectors. The company’s platforms assist organisations in managing essential functions such as student enrolments, apprenticeships, payroll, HR, and compliance.
By offering tailored solutions, ReadyTech simplifies complex administrative processes and enhances operational efficiency for its clients. The company prides itself on its people-first approach, combining cutting-edge technology with deep sector knowledge. ReadyTech has positioned itself as a market leader in delivering scalable and flexible solutions, which are essential for industries that rely on accuracy, compliance, and efficiency.
RDY Company History
ReadyTech was founded in 1998 by Marc Washbourne, who remains with the company today. Its first product was JobReady, a product for employment providers, designed to support them to place and keep job seekers at work. Its second product was launched in 2001 and was similar to JobReady but aimed at apprenticeship support providers. The third helped GTOs manage their apprentices in a labour hire arrangement.
The company's first investment in cloud-based technology - and its key offering to this day - was JobReady which captures the student lifecycle to drive student outcomes for VET providers. In 2017, RDY bought HR3 which was a company with a payroll and HR administration system.
This diversification allowed ReadyTech to capture a larger market share and build a strong reputation for providing mission-critical solutions. In 2019, ReadyTech made its debut on the Australian Securities Exchange (ASX), marking a significant milestone in its growth trajectory. The listing provided the company with additional capital to accelerate its expansion and enhance its product offerings. Although it is off its all time highs, it is still well ahead of its IPO price, which was $1.50.
Future Outlook of ReadyTech (ASX: RDY)
Organisations in all three segments of ReadyTech’s business – Education, Workforce and Government – are experiencing a growing and ongoing migration to cloud and SaaS. This digital transformation across all industries is nothing new, but what is news that this transformation has been accelerating in the wake of COVID-19 shutdowns as demand soared for technology-driven initiatives to enable remote work, distance learning, new customer experiences and new online sales channels.
ReadyTech’s financial performance for the year ending 30 June 2024 indicated promising growth in some areas but also highlighted challenges in others. ReadyTech’s underlying EBITDA was $38.8m, up 11.5% and representing a 34% margin. Its profit was $5.5m, up 9%. The company has advised shareholders to expect organic revenue growth to be in the low to mid double digits and a 34-35% EBITDA margin. It is aiming to achieve $160-170m in FY27.
The company's 1H25 results were not received well by investors as its underlying EBITDA margin fell from 31.8% to 31.2%, its revenue only increased 6.6% and expenses increased 7.8%. Even though the company reiterated its targets and boasted it had a $37.5m enterprise pipeline, shares fell 30% over the following 2 months. It is true that Trump's tariffs had an impact, but it didn't help that RDY had made a significant retreat from mid-teens growth.
Is RDY a Good Stock to Buy?
The decline in the company's share price is a key concern for investors, especially given the company’s recent net loss and the volatility in its financial performance. While the company continues to show growth potential, particularly through its SaaS offerings, the recent downturn suggests that it may take time for ReadyTech to regain investor confidence. It may take returning to mid-teens growth until investors look at the company again.
For investors with a long-term horizon, ReadyTech may present an opportunity to buy at a lower price, but they should weigh the potential for recovery against the risks of continued underperformance.
Our Stock Analysis
Our 5 best ASX stocks for 2024
It is nearly the end of 2023, and so it is time to share our best ASX stocks for 2024!…
Why Telstra’s $267.5m purchase of Versant is a very big deal for investors
Earlier this week, Telstra (ASX:TLS) forked out $267.5m to buy cloud computing Versant. Given Telstra’s $40bn+ market cap, this may…
The 4 Best ASX Tech stocks for September!
Here are 4 companies that we think are the best ASX tech stocks for September! What are the Best…
How exactly do high interest rates impact tech stocks? Here are 6 ways
We all know high interest rates impact tech stocks. But while most investors would know that fact, not all investors…
4 astonishingly undervalued tech stocks for growth-oriented investors to consider
The Tech Wreck has created opportunities for investors to buy undervalued Tech stocks. But some represent better opportunities than others.…
- « Previous
- 1
- 2
Frequently Asked Questions
ReadyTech does not currently pay a dividend to its shareholders. This may be a concern for income-focused investors, but it is typical of companies in the growth phase, where capital is reinvested into expanding the business.