...bonnes perspectives pour 2022:
(Note: this analysis of Sep. 02, 2021 did not take into account subsequent agreements / deals with: "TalkTalk UK" (with Over4 million broadband customers); PREMIERE MAX - France (for Premiere's 3,375,000 readers) and Ireland’s no.1 Broadband Provider Pure Telecom launche by Netgem.TV)
seekingalpha research:
"On a conservative basis, the net equity valuation per share is estimated at €2.7 at FY2021, €3.6 at FY2022 and €4.7 at FY2023, representing massive triple-digit upsides from where we are today."
"(...)
C5. Conservative valuation suggests significant upside
To value Netgem which is in essence a growing technology business, we can reasonably use the EV/EBITDA approach based on a conservative projection.
Gross profit. Given the multiple drivers of growth I believe that Netgem can maintain at least a 15% growth guidance in 2021 over the next few years. This 15% guidance incorporates the impact of the global shortage of certain electronic components. Let's assume 15% growth for future year for the sake of conservatism.
Operating expense. Despite gross profit growth, Netgem is able to reduce cost in 2021 thanks to the restructuring and cost savings at Vitis. These activities are still ongoing so we should be able to see further benefits. Putting this upside aside, after the cost of goods sold, Netgem is a basically a fixed-cost business thanks to its focus on software development and B2B distribution. For conservatism, I assume the increase in expense corresponds to 25% of gross profit increase or an implied marginal EBITDA / Gross Profit of 75%.
EV. To estimate EV, I conservatively use a multiple of EV/EBITDA of 15x, which could be considered to be low for a growing technology business. We observe much higher multiples in similar businesses below.
Net Cash. Net cash of €4.3M at the end of June 2021 is adjusted in the calculation.
Minority Interest. 47% of Vitis is owned by other shareholders (Groupe Caisse de Dépôts and Océinde). I conservatively assume this minority part represents 20% of Netgem value despite the fact that the Europe ex. France, notably in the UK, have a much better profitability and growth prospect.
(...)"
Read all research on Netgem at (Sep. 02, 2021):
https://seekingalpha.com/instablog/52575557-frencheese-investor/5633545-netgem-hidden-nano-cap-gem-of-french-tech
Netgem:
- "Leading provider of B2B Internet TV services in Europe.
- Successful transformation from a hardware manufacturing business to an as-a-service business model with 90% of recurring revenues and multiple paths to continue double-digit % growth of gross margin.
- Market under-appreciates the value of the transformation and even a conservative valuation suggests triple-digit % upside. "
SOURCES (Sep. 02, 2021):
https://seekingalpha.com/instablog/52575557-frencheese-investor/5633545-netgem-hidden-nano-cap-gem-of-french-tech
https://www.netgemresearch.com/archive
