RE:Subversive Capital Announces US$381 Million Cash Position Fo Lots of moving parts to this transaction. I am still trying to separate the hype from the underlying business amalgamation and actual strategic business proposition going forward. I am somewhat familiar with Caliva and was very impressed with that business platform; however, I am leery of amalgamating different corporate cultures for purported synergies and efficiencies as oftentimes it is not at all that simple. Their investor call certainly was quite a convincing sales pitch and they clearly have an impressive team and a big vision for California domination.
With the revised cash position at closing I'm calculating the closing EV at roughly 800M, so pro forma capital and valuation metrics should be adjusted from the corporate presentation. Based on a starting share price of $10, 2021 EV/Revs are 2.4 and 2022 EV/Revs are 1.35. These are very cheap forward looking metrics (assuming revenue projections are realistic) and certainly suggest a potential re-rating may occur. By comparison Indus holdings, another California company is trading by my calculations at roughly 2021 EV/Revs of 3.2 and they do not have anywhere close to the downstream acumen, branding cache or capital infused expansion potential of Subversive. To my knowledge Subversive is the Goliath company in the Goliath state and their strategy is very compelling.
Per corporate presentation they have 116M shares out with additional 5.6M founder shares. Does anyone know if there are any hidden additional dilutive possiblilties with the current share structure?
despacs can be quite volatile so in the short term possibly wild swings ahead... I'm curious if others agree with my EV callcs along with any thoughts and analysis of this company.
Cheers!