RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Tax loss arrives Earlier this year For the sake of sanity, I am going to condense your three posts into one.
Noshortsallowed wrote: They grew their revenues by 127% as of Q2. They grew their gross profit by 150% and as of Q2 were growing at 20% organically (according to their website at least). You use numbers dating back to last year yet I base my numbers on their expected growth (something that seeks to put a value itself in the prospect for growth for which well is particularly suited to do in this inflationary environment. The basis of your valuation is flawed as it does not acknowledge what this company has managed to do in the last few years and what they are uniquely suited to do in the very near future.
Your original post was about EV/EBITDA valuation, so I focused there. Assuming your numbers are correct above, then there probably a lot of reinvestment that is causing a drag on the EBITDA numbers. My valuation basis is the same as yours, 2023 EBITDA, so if mine is flawed, yours must be too. We can agree to disagree on the amount of EBITDA or the multiple. In my case, I put in historical adjusted EBITDA numbers to demonstrate that the company does not have a track record of hitting the numbers required in your valuation.
Noshortsallowed wrote: And aside from that other growth stocks in those sectors are trading at multiples of above 20x for EV/Ebidta
Which ones?
Noshortsallowed wrote: And while in certain sections of the company there is cash flow going to those minority interests you under value the fact that they have a right of refusal and operation conrtrol of the underlying asset. Multiples have been compressed but if the narrative changes with respect to the narrative surrounding easing of QT then those multiples could easily reverse direction.
The cash flow to minority interests is NOT immaterial; for the last quarter alone it was 27% of adjusted EBITDA. I am not undervaluing anything, I am ignoring the cash flow that doesn't belong to WELL in my calculations, which is standard financial practice. It might be the case that they can buy those assets at a bargain, but don't forget they are still going to need to pay for them. That will either increase share count or they will need cash. There is no free lunch here.
I don't understand your point about the narrative on easing of QT. I don't think anyone sees multiple expanding anytime soon.
WELL isn't going broke since health care is defensive. The only real question is what the stock is worth.
Unfortunately, you aren't making a coherent case for your valuation of $9 per share.