An overlooked and undervalued platform company
We initiate our coverage of MGI with a target price of SEK 23 and a BUY recommendation. The majority of MGI’s revenues are derived from commissions for matching advertiser and publishers on their ad software platform. As a platform company MGI’s costs are mainly variable, which should enable the company to scale up while still delivering solid earnings growth. Considering these factors, we assess that the company has good prospects for long-term value creation. At the current valuation, the market expectations for MGI are low and should be beatable with decent growth and a modest upshift in valuation multiples. At the current market valuation, we consider the risk/return ratio to be attractive.
Verve
Verve (Ticker: VER) is a fast-growing, profitable, digital media company that provides AI-driven ad-software solutions. Verve matches global advertiser demand with publisher ad-supply, enhancing results through first-party data from its own content. Aligned with the mission, “Let’s make media better,” the company focuses on enabling better outcomes for brands, agencies, and publishers with responsible advertising solutions, with an emphasis on emerging media channels. Verve’s main operational presence is in North America and Europe. Its shares are listed on the Nasdaq First North Premier Growth Market in Stockholm and the Scale segment of the Frankfurt Stock Exchange. The company has three secured bonds listed on Nasdaq Stockholm and the Frankfurt Stock Exchange Open Market.
Read more on company pageKey Estimate Figures2022-12-12
| 2021 | 22e | 23e | |
|---|---|---|---|
| Revenue | 252.2 | 323.0 | 352.0 |
| growth-% | 79.84 % | 28.08 % | 8.99 % |
| EBIT (adj.) | 54.9 | 67.8 | 66.5 |
| EBIT-% (adj.) | 21.76 % | 20.98 % | 18.89 % |
| EPS (adj.) | 0.24 | 0.19 | 0.18 |
| Dividend | 0.00 | 0.00 | 0.00 |
| Dividend % | |||
| P/E (adj.) | 18.35 | 20.42 | 22.28 |
| EV/EBITDA | 13.18 | 11.66 | 10.87 |
