Keys fom Salman Report We use a ten-year, four stage discounted cash flow analysis to determine a present value for Ortsbo of approximately $398.0 million or $1.24 per Intertainment share. In conjunction with the other Intertainment assets, we derive a total value of $1.30 per Intertainment share.
Inexpensive valuation. Based on the metric value per user (defined as market capitalization divided by the number of users), we believe Intertainment is cheap. We estimate that the company’s current value per user is at $5.26, whereas its peers trade at much higher levels: $20.78 for Pandora, $32.88 for Zynga, $90.77 for LinkedIn, $90.99 for Groupon and $108.82 for Facebook. Based on a ten-year, four-stage discounted cash flow analysis, we estimate that Ortsbo alone is worth approximately $10.00 per user, or $1.24 per Intertainment share
Software revenues carry gross margins of about 90%, and consist of yearly recurring maintenance revenues as well. We believe that the release of the enterprise O4O could lead to a significant increase in profitability at Intertainment.
Ortsbo will generate revenues from three sources. First, revenues will be made from online advertising. Second, the company will receive sponsorship revenues from corporations (such as Coca Cola) or media firms (such as Variety) from hosting Live & Global events. Revenues from such events could be in the form of royalties or co-sharing. And third, software sales from new products launched and expected to be released in the coming quarters is forecasted to garner additional revenues as well.