Post by
Stonksonlyup90 on Dec 18, 2022 11:01am
VALUATION
Wondering what other investors thoughts are in regards to what a reasonable valuation would be.
What could be a reasonable benchmark? I've been reviewing the Alarmforce transaction from back in 2017, where Bell Canada was the purchaser.
Alarmforce had Fiscal Year 2016 Annual revenue of $56.4M and AEBITDA of $6.4M for that year. The purchase price was $184M (majority comprised of cash)!
Avante Security will likely finish this year with revenue roughly in the $20M ballpark. AEBITDA could perhaps finish in the $2M range (but this needs to improve as they scale the business).
There is clearly value here, but management needs to scale the business to be relevant. If we were to trade on the revenue multiple that Alarmforce sold for (stripping out the cash), we would be trading at $55M - or $2.08M/share.