Idea note
This is an Idea note; It’s a collection of early signals – companies mentioned in fund letters, blogs, or by sharp investors online. Not a full pitch, just a starting point for ideas that might be worth a more in-depth look.
AI-Powered Legal Information Leader Accelerating Margin Expansion
Idea source: D&G Small cap
Price: 101 SEK (2025-06-26)
Karnov Group AB - Leading European provider of mission-critical legal, tax and accounting information services to over 500,000 professional users. Listed on Nasdaq Stockholm Mid Cap.
Ticker: KAR | Timeframe: 18-24 months | 🚅 Momentum
D&G Small cap believes Karnov Group presents a compelling investment opportunity as it executes a comprehensive transformation strategy. The fund points out that Karnov’s Q1 2025 results show strong operational momentum, with revenue increasing by 6.5% and adjusted EBITA margins rising to 26% from 22.7% in the same quarter last year. D&G Small cap considers the company’s newly launched AI assistant a significant growth driver, commanding at least a 30% pricing premium while gaining widespread adoption among law firms and government agencies. The fund believes that the combination of the ongoing EUR 20 million synergy program through 2026 and AI-driven revenue growth positions Karnov for sustained profitable expansion.
Setup: European legal information leader with 85%+ subscription-based revenue model and 90%+ renewal rates executing comprehensive AI and operational transformation.
Latest Development: Q1 2025 results show 6.5% revenue growth and 330bp EBITA margin expansion, with AI assistant gaining strong customer traction.
Mispricing Reason: The Market underappreciates AI monetization potential and synergy program execution speed.
Timing: Company entering final phase of EUR 20m synergy program while AI products scale commercially.
Value Catalysts: AI assistant rollout, margin expansion toward 30% target, potential acquisitions, synergy delivery.
Valuation: EV/EBIT NTM 18x slightly above three-year median.
Risks: AI adoption slower than expected, competitive pressure, integration execution challenge
Disclaimer - Not Investment Advice
The content on Lind Research is for informational purposes only and should not be considered as investment advice financial advice. One should always consult a qualified professional before making any investment decisions. Investments carry risks, including the potential loss of capital. Lind Research and its authors bear no liability for decisions made based on the information provided here. All views are personal and not reflective of any company mentioned. Lind Research, it’s affilaites, personnel, clients and/or partners might hold investments in securites discussed.
By accessing Lind Research, you acknowledge and agree to this disclaimer.
