Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Search by ticker code:
Generic filters

Why Hansen Technology (HSN) Shares Are An ASX Portfolio Staple

The investing world is littered with fads and keywords — we have all heard of ‘pot stocks’ and how lithium is going to change the world — but one thing that is currently gaining a lot of traction is ‘SaaS’ and ‘Recurring revenue’. Hansen Technologies Limited (ASX: HSN) plays into this thematic. 

For educational purposes, I would like to provide a brief overview of both:

  • Software as a service (SaaS) is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted.
  • Recurring revenue is the portion of a company’s revenue that is highly likely to continue in the future. Recurring revenue is revenue that is predictable, stable and can be counted on in the future with a high degree of certainty.

Imagine if you had a company that could do both? That sounds like the nirvana of business models – a growth computer that just has to sit back and collect the cheque each month.

Unfortunately, investor euphoria has led to far too many SaaS stocks appearing on the ASX and these have created a mini-wave of phoenix-like companies looking to capitalise on the SaaS boom.

However, it’s not all gloom and doom for investors looking to gain exposure to technology stocks,  companies like Hansen Technology have not only stood the test of time but from a humble beginning grown to become a global player in the billing software market.

Hansen’s recent price fall has created an opportunity for savvy investors looking to purchase a high-quality business on a reasonable valuation. 

Here are my top 3 reasons why Hansen should be staple in your portfolio

1. Management skin in the game:

Hansen’s CEO Andrew Hansen took over from his father and has been the CEO for over 16 years and owns approximately 20% of company shares. As an investor, you cannot ask for much more management commitment than having your name on the company letterhead.

2. Defensive Recurring revenue:

As a billing software business Hansen’s revenue is recurring in nature. This frequency ensures a constant stream of income to not only cover costs but to reinvest in R&D. Also, due to the complexity of their software, companies easily become ‘sticky’ and are committed to longer term contracts. At the end of the day all a company wants is for their billing system to work!

3. Market Dominance:

Hansen has grown to become one of the biggest players in its market, this has mainly been driven by R&D investment and strategic acquisitions. One of its recent acquisitions was Nordic based Enoro which delivered better than expected EBITDA margins. This validates my point that Hansen’s acquisition strategy is targeted and strategic. 

Is Hansen A Long-Term Winner?

As a long term shareholder of Hansen, I am happy to tick the Dividend Reinvestment box and let the compound interest work its magic.

FREE REPORT: 2 ASX Tech Shares For 2019

[ls_content_block id=”14947″ para=”paragraphs”]

At the time of writing, Anthony owns shares of Hansen Technologies but this could change at any time.

$50,000 per year in passive income from shares? Yes, please!

With interest rates UP, now could be one of the best times to start earning passive income from a portfolio. Imagine earning 4%, 5% — or more — in dividend passive income from the best shares, LICs, or ETFs… it’s like magic.

So how do the best investors do it?

Chief Investment Officer Owen Rask has just released his brand new passive income report. Owen has outlined 10 of his favourite ETFs and shares to watch, his rules for passive income investing, why he would buy ETFs before LICs and more.

You can INSTANTLY access Owen’s report for FREE by CLICKING HERE NOW and creating a 100% FREE Rask Account.

(Psst. By creating a free Rask account, you’ll also get access to 15+ online courses, 1,000+ podcasts, invites to events, a weekly value investing newsletter and more!)

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

Skip to content