Seeing what you want to see
I see some positive sentiment being expressed here re Scotia's comments. This appears to be based on a $3 target price, which in turn is based on a 2024 EV/EBITDA multiple of 23.
It isn't my intent to kick a stock when it's down. Heaven knows we all have losers in our portfolios. BUT.
Has this analyst been off-planet since November??? An EV/EBITDA multiple of 23?
For those of you who don't know, in the immortal words of Charlie Munger EBITDA is profit before expenses. I would also note that comparing Xebec to companies 100 times as large is questionable. Rather like comparing Grande Prairie, Alberta to Toronto in a discussion of urban problems.
For those who can only see about half the page of the Scotia report, it's worth pointing out some projections over the years 2023-24-25. Revenues are expected to grow from $240 million to $316.8 million to $400.7 million. After-tax income goes from a loss of $13.2 million, a loss of $5.8 million, to a profit of $6.5 million. Think on that for a moment. Here we have an industry that's going to save the planet but it's going to be a LOT LESS profitable than packing pork and beans into aluminum cans.
The same analyst at Scotia covers Anaergia. Over the same time frame, he sees Revenue of $465 million, $672 million and $885 million. Net income goes from $82.4 million, to $121 million, to $172 million. Much better than pork and beans!