Target Price: $1.15
Poynt Corp. (PYN - TSXV,
.13)
Rating: SPECULATIVE BUY / Target Price: $1.15
Notes on Valuation in Advance of the Yelp IPO
Yelp, a website that features reviews of local businesses, filed to go public late in the fall. Below, we look at some valuation metrics for Yelp and compare them to Poynt. While Poynt and Yelp are not identical companies by any stretch, they both fit loosely into the #lomoso (local, mobile, social) app space.
Yelp Raised Two Rounds of Financing in the Period Above: The first one was in early 2008, where the company raised $15 million at a rumored $200 million pre-money valuation. We note that Yelp's revenue growth profile at that time was similar to Poynt's right now.
Yelp Then Raised Another Round in Early 2010: $100 million at a pre-money valuation of $475 million. The IPO valuations being discussed are $1.5 - $2.0 billion.
Investment Conclusion: If Poynt can continue its strong growth and come close to meeting our forecasts, this level of performance has offered investors of a company in a related industry very strong investment returns and valuations. We rate the stock a Speculative Buy with Venture Risk. The potential returns are significant but this must be balanced with the understanding that there are substantial risks to investing in companies at this early stage.
We Maintain Our SPECULATIVE BUY rating and $1.15 target price. We use a combined EV/EBITDA and P/E for our valuation. P/E, on a 2013 forecast of
.047 EPS for Poynt, using the median value of 26.3x NFY EPS for peer companies, gives a value of $1.24. EV/EBITDA using a median NFY multiple of 13.0x gives an enterprise value of $1.08. The composite 12-month target is thus $1.15.
Time is coming, take out target !
the above is just my opinion, govern yourself accordingly.
Always get the:
Point
Educational Purposes Only