Blender Bites Limited V.BTEC.H

Valuation & outlook

[Sujanstockpicks]

At a $8M market cap, the company is valued at like a 4.5 price/sales multiple. That is not necessarily cheap for a growing but money losing and pretty moatless SaaS play. Ackroo for example, is in the same business but valued at a p/s multiple of only 2. For Rewardstream, it's a balancing act between investing in growth and keep the balance sheet healthy, since they only have $1M working capital according to my estimates. The next earnings report will shed some more color. 

I like the business model though, management seems quite experienced and I noticed a few insider buys took place last week, always good to see. 

However, the valuation is at a $0.20 stock price a little bit rich, so I only will buy shares when the price declines to 0.15 or lower. I also suspect they need to raise money within a few months to ramp up growth.