PARADIGM INITIATES COVERAGE OF SNIPF CONTINUED How did they get a .30 price target:
We are initiating coverage of SNIPP with a Buy rating and C$0.30 target. We value the company using an EV/2023e revenue multiple of 2.0x and a DCF. Our DCF utilizes a WACC of 12.0% and a terminal exit multiple of 12x. Given its investment into growth and prioritizing the top line above profitability, we do not view utilizing an EBITDA multiple as appropriate at this point. Our comparable group consists of loyalty and marketing software providers, consumer analytics and advertising agencies. The group trades at an average 1.9x EV/2023e revenue while SNIPP trades at 1.1x. Current levels offer an attractive entry point into a marketing technology firm capitalizing on several opportunities in the multi-billion-dollar marketing space, leveraging consumer data at its core to help solve marketing challenges faced by some of the biggest brands in world.