| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 101.61 | -27 |
| Intrinsic value (DCF) | 76.66 | -45 |
| Graham-Dodd Method | 0.06 | -100 |
| Graham Formula | 1.64 | -99 |
ME Group International plc (formerly Photo-Me International plc) is a leading operator of instant-service equipment across the UK, Continental Europe, Ireland, and Asia. Specializing in coin-operated photobooths and vending machines, the company serves both identification and entertainment markets. Its diversified portfolio includes digital photo kiosks, laundry machines, business service equipment, amusement machines, and children's rides. With over 27,867 photobooths and 43,817 vending units as of 2021, ME Group maintains a strong presence in high-traffic locations such as shopping centers, transport hubs, and leisure venues. The company rebranded in 2022 to reflect its broader focus beyond photobooths, emphasizing automation and self-service solutions. Headquartered in Epsom, UK, ME Group operates in the Industrials sector under the Business Equipment & Supplies industry, leveraging recurring revenue streams from its installed base while expanding into new markets.
ME Group International presents a stable investment opportunity with a defensive business model driven by high-margin, recurring revenue from its extensive installed base of photobooths and vending machines. The company's low beta (0.653) suggests lower volatility compared to the broader market, appealing to risk-averse investors. With £307.9M in revenue and £54.1M net income, ME Group demonstrates solid profitability, supported by strong operating cash flow (£87.2M). However, reliance on physical foot traffic exposes it to macroeconomic downturns and shifting consumer behaviors. The dividend yield (7.9p/share) is attractive, but investors should monitor capex trends (£-52.1M) and debt levels (£59.8M against £86.1M cash). Geographic diversification mitigates regional risks, though slower growth in mature European markets may pressure expansion efforts.
ME Group International holds a niche leadership position in instant-service equipment, particularly photobooths, where its scale (27,867 units) and long-standing contracts with venue operators create barriers to entry. The company's competitive advantage stems from its extensive distribution network, proprietary software for photobooths, and ability to monetize high-traffic locations. Unlike pure-play vending machine operators, ME Group's dual focus on identification (e.g., passport photos) and entertainment diversifies revenue streams. However, the rise of smartphone photography and digital ID solutions poses a long-term threat to its core photobooth business. Competitively, ME Group outperforms smaller regional players through centralized servicing and economies of scale but lacks the technological innovation pace of digital-first rivals. Its shift toward laundry and amusement machines reflects a strategy to reduce dependency on photobooths, though this requires ongoing capex. The company's asset-light model (outsourced manufacturing) enhances margins but limits control over supply chain disruptions.