Azkoyen, S.A. (AZK.MC) fair value

ACCE thesis

Azkoyen makes coin mechanisms, vending machines and beverage dispensing equipment for food and drink operators, with a sizeable share of its sales coming from the coffee and cashless payment segment. The business has a real moat in its installed base and the service and consumables revenue that follows from it, with gross margins of 64.9% pointing to pricing power that a typical equipment maker would not have. Revenue growth of 6.2% and a 12.9% ROE at a 15.8x trailing P/E, against a 9.6% operating margin, suggest the market is pricing in a steady rather than a re-rating story. The question for a deeper look is whether the operating margin can climb toward the gross margin level as the mix shifts toward higher-margin payment and service, given that the company trades at a small market cap of 246M EUR and sits outside any major index, which limits passive demand.