Insights

Rhipe (ASX:RHP) share price is up today. Here’s why

The Rhipe Ltd (ASX: RHP) share price is up 2% after the cloud channel company announced it was buying a Kiwi IT services provider.
The post Rhipe (ASX:RHP) share price is up today. Here’s why appeared first on Motley Fool Australia. –

Technology

The Rhipe Ltd (ASX: RHP) share price has risen today, up 2% to $1.74 at the time of writing. The cloud channel company announced it has entered an agreement to acquire Parallo, a New Zealand-based IT services provider.

What does Rhipe do?

Rhipe is a global leader in cloud and technology solutions. The company provides licensing, business development and knowledge services in the growing cloud market.

Clients such as Microsoft, VMWare, Citrix and others utilise Rhipe’s platform to build and support their cloud licence programs. Most notably, Rhipe’s services and support division is the industry leader in Microsoft’s 365 implementation.

Rhipe takeover

Rhipe announced this morning it was buying Parallo for NZ$4.25 million. The 100% acquisition will support Rhipe’s customers by developing infrastructure technology to drive growth and opportunities.

In the past 9 years, Parallo has invested in service offerings focused on Microsoft Azure and VMware software, Rhipe’s two largest software vendors.  The purchase is anticipated to strengthen Rhipe’s brand positioning, and leverage cost and revenue synergies.

The acquisition will be completed in the next four weeks.

What did management say?

Rhipe CEO Dominic O’Hanlon was happy with Parallo’s achievements. He said:

Parallo has done an outstanding job as one of the leading IT service providers, delivering cloud-services and solutions that drive value to their local ISV market. This investment is significant in helping us achieve an enhanced product and services offering initially in New Zealand and Australia. As well as being cloud software and infrastructure focused, the majority of Parallo’s revenue is annuity based, which is very similar to rhipe’s revenue profile.

Mr O’Hanlon went on to say:

We intend to continue investing in the Parallo business to support its expansion into the Australia market, leveraging Rhipe’s existing employee and partner footprint. We look forward to utilising the skills and expertise of the Parallo team, combined with Rhipe’s extensive channel, to deliver greater outcomes for our partners.

Should you invest

The Rhipe share price has tumbled since the beginning of the year, down 12% from $2.06. However, in the months following, the Rhipe share price has been relatively flat, reaching a 52-week low of $1.16.

With a market capitalisation of $287 million and a price to earnings (P/E) ratio of 52, I would urge caution buying Rhipe shares. I think there are plenty of other ASX shares that are less high risk and offer more growth opportunities.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Rhipe (ASX:RHP) share price is up today. Here’s why appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!