The Valutico team is excited to reveal a series of useful new features, now live in the main valuation platform. See below for the latest set of upgrades and watch this space in early 2024 for more to come soon.

New Professional Report Style:

What? We’ve completely modernized the report style, ensuring a more user-friendly experience. The logical structure and cleaner aesthetic enhance the presentation of results, all while preserving the customization features that provide the ability to white label your reports.

Where? Users can find the revamped style in Exports (look for „Modern“).

Why Important? An intuitive and visually appealing report style not only makes your findings more accessible but also allows for clearer communication. The customization options ensure that your unique insights can be presented in a format that aligns with your preferences and brand identity.

New Emerging Market Data (From EMIS):

What? We’ve integrated new emerging market transaction data from EMIS, a significant enhancement covered by major news outlets like Yahoo Finance and Asia One. New and existing customers can reach out to upgrade and access this valuable data that opens doors to critical insights.

Where? Available in Transactions Search.

Why Important? In today’s swiftly evolving business landscape, access to emerging market transaction data becomes indispensable, especially for valuation professionals working across Asia, Latin America, Eastern Europe, the Middle East, and Africa.

M&A – Minority, Control & Synergistic Value Adjustments:

What? Introducing a new ‚levels of value‘ reporting graph that automatically adjusts company value for minority value (non-marketable & marketable), control value, and synergistic value.

Where? Find this new chart in the Valuation Report.

Why Important? The new adjustments enable a more nuanced understanding of company worth, catering to scenarios where minority ownership, control, and synergies play pivotal roles. This is invaluable for investors, analysts, and strategists who need to assess value based on these important situations.

Better Transaction & Peer Search Options:

What? Improved search capabilities across multiple transaction datasets simultaneously, with the added convenience of remembering your previous search criteria.

Where? Utilize these enhancements in Transactions & Peers.

Why Important? Efficient and comprehensive searches are fundamental to informed decision-making. The ability to search across multiple datasets at once, plus having your search criteria remembered, streamlines your workflow, allowing you to explore a broader range of data effortlessly.

Knowledge Base – Your Questions Answered:

What? A comprehensive Knowledge Base resource has been added to address all your queries on the platform, with exciting future plans for continuous expansion.

Where? Access answers in the Knowledge Base.

Why Important? Even though Valutico’s platform makes valuations simple, valuation is still a complex arena – having a centralized resource answering key questions provides additional support to all our users, and helps them make the most of the platform’s capabilities.

Resources Section Date Improvement:

What? We’ve added a ‚date picker‘ across key resources sections, allowing you to examine risk-free rates, corporate tax rates, market risk premium, and country ratings across any historic date you select.

Where? Explore this feature in the Resources section.

Why Important? Historical context is essential in valuation. The ability to pinpoint specific dates ensures that your analyses consider the nuances of economic conditions and regulatory landscapes at the time, providing a more accurate and contextualized perspective.

What’s Next?

With each new improvement our platform becomes more powerful and refined for all our users‘ needs. Stay tuned for more exciting and significant updates coming in early 2024.

The post Valutico Announces Six New Features   appeared first on Valutico.

Weekly Valuation – Valutico |  April 21 2023

Link to the valuation

About the company

Incorporated in 2015, The Kraft Heinz Company (KHC) is a leading American multinational food company with co-headquarters in Chicago and Pittsburgh. It was formed by merging two renowned entities, Kraft Foods and H.J. Heinz Company. KHC stands out as the fifth-largest food and beverage company worldwide, and third-largest in North America. The company boasts eight iconic brands with revenue of more than $1 billion.

Recent M&A deals

KHC has been making headlines with strategic moves like acquiring Cerebos Pacific in 2018 and selling off assets such as its Indian nutritional beverage and Canadian natural cheese businesses in 2019. In addition, the company partnered to produce Kraft and Velveeta cheeses and sold part of its cheese business to Lactalis for $3.2 billion in 2020. While expanding its portfolio in 2021 and 2022 with acquisitions like Brazil’s Hemmer condiment and sauce company and an 85% stake in Germany’s Just Spices GmbH, the company has also recently agreed to sell its Russian baby food business to Chernogolovka. This move allows local firms to capitalize on the departure of Western brands.

Recent Financial Performance

Kraft Heinz reported a 1.7% increase in net sales to $26.5 billion, with organic net sales up 9.8% in the last year . However, volume/mix declined 3.4%, with declines in both reportable segments primarily driven by supply constraints and elasticity impacts from pricing actions. Net income increased 131.3% to $2.4 billion, driven by lower interest expense and lower non-cash impairment losses, offset by lower Adjusted EBITDA, an accrual related to the securities class action lawsuit, and higher supply chain and commodity costs. Adjusted EBITDA decreased 5.8% to $6.0 billion.

Share Price Performance

KHC’s heavy debt load following its merger in 2015 was lightened by the pandemic’s increased demand for food, lower interest costs, and opportunities for divestment. Despite a flat operating performance in 2021, the company successfully reduced its net debt to $22 billion. The company’s stock price has fluctuated between $35 and $45 over the past year, with its current trading price at $39.08 per share.

Five-year share price chart is shown below:

Source: Yahoo Finance, https://yhoo.it/3V1pfmA

Valutico Analysis

We analyzed KHC by using the Discounted Cash Flow method, specifically our DCF WACC approach, as well as a Trading Comparables analysis. The Discounted Cash Flow analysis produced a value of USD 75.3 billion using a WACC of 6.3%.

The Trading Comparables analysis resulted in a valuation range of USD 45.7 billion to USD 74.5 billion by applying the observed trading multiples EV/Sales, EV/EBITDA, EV/EBIT and P/E. For our Trading Comparables we selected similar peers such as The Hain Celestial Group, Inc., The Simply Good Foods Company and Campbell Soup Company.

Combining our DCF WACC and Trading Comparables analysis results in a valuation range of USD 53 billion to USD 73 billion. In comparison to Kraft Heinz Company market capitalization of USD 47.4 billion we suggest that the company is undervalued. Could the KHC share price break out of its recent sideways trading pattern to the upside to reflect its intrinsic valuation? Let us know in the comments.

Link to the valuation

Disclaimer

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post Breaking Ties: Kraft Heinz Closes Business Operations in Russia appeared first on Valutico.

Weekly Valuation – Valutico | April 7 2023

Link to valuation 

Interior Empty Modern Loft Office open space modern office footage.Modern open concept Lobby and reception area meeting room design.4k . 3d Rendering and drawing line sketch.

Context

First Citizens BancShares, Inc announced on March 27, 2023 that it has entered into an agreement with the Federal Deposit Insurance Corporation (FDIC) to purchase Silicon Valley Bank after a wave of withdrawals that caused the largest banking collapse in the US in over ten years. The agreement is expected to alleviate some of the chaos that has been shaking the financial system, and the announcement has caused local bank stocks to rise significantly.

About the buyer

First Citizens Bank, is a US-based North Carolina state-chartered commercial bank that was founded in 1898. With over USD 218 billion in total assets, the bank has expanded its presence across 23 states, operating a network of more than 500 branches as well as a nationwide direct bank. Its growth strategy has included the acquisition of distressed banks, having purchased 12 banks out of receivership since the global financial crisis. In its most recent acquisition, the bank acquired CIT Group in a highly accretive deal, combining CIT’s specialized commercial lending portfolio with First Citizens Bank’s strength as a deposit-gathering franchise.

Recent Financial Performance

First Citizens BancShares, saw significant growth in net interest income after the recent merger, with net interest income jumping from USD 1.39 billion to USD 2.95 billion in the past year. While the bank serves small and medium businesses, it has less exposure to vulnerable businesses than Silicon Valley Bank. However, the bank carries risks, particularly with its USD 29.1 billion in uninsured deposits. To strengthen its financial position, First Citizens Bank increased its borrowings from the Federal Home Loan Bank to USD 9 billion, effectively increasing its pre-acquisition cash position from USD 4 billion to USD 10 billion. The bank has also made other moves to enhance its financial position and has seen a USD 1.3 billion increase in deposits since the end of last year.

About the deal

First Citizens Bank acquired Silicon Valley Bank’s branches, loans, and deposits in a complete purchase and assumption agreement with loss share coverage. The FDIC retained about USD 90 billion of SVB securities and agreed to share any potential losses or gains on SVB’s commercial loans with First Citizens. The FDIC will provide a USD 35 billion loan over five years to finance the deal and a USD 70 billion line of credit to cover potential deposit flight. The estimated cost of the bank’s failure to the Deposit Insurance Fund is about USD 20 billion, and the FDIC will receive equity appreciation rights in First Citizens with a potential value of USD 500 million. First Citizens will assume USD 56 billion in deposits, and 17 branches will operate as Silicon Valley Bank, a division of First Citizens, with no immediate changes to customer accounts.

Share Price Performance

In the last five years, investing in First Citizens stocks, like other banks, has been unprofitable for investors with only marginal returns. The Covid-19 crisis in 2020 led to a marked decline in the stock price, but financial stimuli from the FED helped to reverse this situation in 2021. However, the bank faced challenges in 2022 due to the same monetary policy and high interest rates. Despite this, the bank’s stock price has rallied to as high as 49%, with shares gaining 13.3% over the past six months, outpacing the industry’s decline of 15.1%. The recent acquisition of the failed SVB has boosted investor confidence in the North Carolina-based bank, and as of April 7 their stocks are trading around USD 998.

Five-year share price chart is shown below:

Valutico Analysis                                           

We analyzed First Citizens BancShares, Inc. by using our Flow-to-Equity simplified approach, as well as a Trading Comparables analysis. The Flow-to-Equity analysis produced a value of USD 12.66 billion using a Cost of Equity of 9.0%.

The Trading Comparables analysis resulted in a valuation range of USD 10.58 billion to USD 14,05 billion by applying the median of the observed P/E and P/B multiples of the peer group. For our Trading Comparables we selected similar peers such as M&T Bank Corporation, Huntington Bancshares, Inc. and Commerce Bancshares, Inc.

Combining our Flow-to-Equity and Trading Comparables analysis results in a value range of USD 10.91 billion to USD 13.28 billion. In comparison to BP’s market capitalization of 14.36 billion we suggest that the company is slighty over valued.

Link to valuation 

Disclaimer

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post SVB – Done deal appeared first on Valutico.

Weekly Valuation – Valutico | 28 March 2023

Link to the valuation

View from the castle with old town, river Aare and Lake Thun in Thun in the Bernese Oberland in Switzerland

Context

In recent days, the financial markets have experienced increased turmoil, causing growing concerns about financial stability. The collapse of SVB had a ripple effect through the banking sector, leading investors to fear that other banks could follow suit. As a result, they have been pouring into money market funds at the highest rate since the COVID pandemic began. Deposit holders are fleeing the banking chaos, and investors are seeking stable havens until the storm passes. However, this has put pressure on banks, including Credit Suisse, a globally systemically important bank. Credit Suisse’s investment banking unit had already been tarnished by a series of high-profile scandals, and its share price took a hit when the leading shareholder ruled out further investment due to regulatory issues.

About the deal

UBS Group AG, a Swiss investment bank, has reached an agreement to purchase Credit Suisse in an all-stock deal, as announced on March 19th, 2023. The acquisition was facilitated by the Swiss government and the Swiss Financial Market Supervisory Authority. To support the deal, the Swiss National Bank provided over CHF 100 (USD 104) billion in liquidity to UBS following its takeover of Credit Suisse’s operations. The Swiss government also offered a guarantee to UBS, covering potential losses of up to CHF 9 (USD 9.6) billion in the short term. As part of the agreement, CHF 16 (USD 17.2) billion worth of Additional Tier 1 bonds were written off completely.

Recent Financial Performance

In January 2023, UBS released its annual results, showing a 14% year-on-year increase in net profits to USD 7.6 billion. The bank also attracted USD 60 billion in net new fee-generating assets in GWM for the full year, USD 25 billion of net new money in AM and CHF 2 billion of net new investment products for Personal Banking, an 8% growth rate. UBS maintained a strong capital position, ending the year 2022 with a CET1 capital ratio of 14.2% and a CET1 leverage ratio of 4.42%.  As of now, UBS is offering a dividend of USD 0.55 per common stock, with a dividend yield of 2.70%. The company repurchased USD 5.6 billion of shares in 2022, and expect to repurchase more than USD 5 billion of shares during 2023.

Share Price Performance

Between February 2018 and February 2020, UBS saw a decline of over 35% in its share price due to weaker profits, which worsened during the pandemic. Despite investor concerns over significant financial market disruption, the markets proved resilient thanks to sufficient capital levels and unprecedented government support for companies, which mitigated the pandemic’s economic effects. UBS’s share value rose in the second half of 2020, and by November 2020, it had recovered its pre-pandemic value. The following year saw sustained price growth with UBS shares increasing from USD 14 to USD 18. Currently, UBS stock is trading at USD 19.43, a 1.04% increase from the beginning of the year when it was trading at USD 18.67.

Five-year share price chart is shown below:

Source: Yahoo Finance, https://yhoo.it/3zf2Gks

Valutico Analysis

We analyzed UBS Group AG by using our Flow-to-Equity simplified approach, as well as a Trading Comparables analysis. The Flow-to-Equity analysis produced a value of CHF 120 (USD 130.5) billion using a Cost of Equity of 7.9%.

The Trading Comparables analysis resulted in a valuation range of CHF 72.8 (USD 79.1) billion to CHF 94 (USD 102.2) billion by applying the median of the observed P/E and P/B multiples of the peer group. For our Trading Comparables we selected similar peers such as Morgan Stanley, Deutsche Bank Aktiengesellschaft and DWS Group GmbH & Co. KGaA.

Combining our Flow-to-Equity and Trading Comparables analysis results in a value range of CHF 77 (USD 83.7) billion to CHF 114 (USD 124.0) billion. In comparison to BP’s market capitalization of CHF 55.1 (USD 59.9) billion we suggest that the company is slightly undervalued.

Link to the valuation

Disclaimer

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post Crash and Bailouts appeared first on Valutico.

Weekly Valuation – Valutico | 20 March 2023

Link to the valuation

Context

The past weeks, the financial market was rattled by the collapse of Silicon Valley Bank, the go-to bank for tech startups, serving half of America’s venture capital-backed tech firms. SVB had been grappling with liquidity concerns in the US, which sparked a massive bank run last week, resulting in its collapse on Friday, March 10th. In response to concerns of contagion, US financial regulators acted quickly over the weekend, assuring customers of the failed bank that they would have access to all their money starting Monday.

HSBC saves the day

HSBC, one of the world’s largest banking and financial services organizations, swiftly acquired the UK division of Silicon Valley Bank in response to the crisis, securing the deposits of numerous British tech firms that had invested their money in the failed bank. This acquisition is expected to strengthen HSBC’s commercial banking franchise and enhance its ability to serve innovative and fast-growing firms, particularly in the technology and life science sectors, both domestically and globally.

About the deal

HSBC Holdings plc announced that its UK ring-fenced subsidiary, HSBC UK Bank plc, was acquiring Silicon Valley Bank UK Limited for GBP 1. As of 10 March 2023, SVB UK had loans of approximately GBP 5.5 (USD 6.7) billion and deposits of around GBP 6.7 (USD 8.1) billion, according to the HSBC statement. It recorded a profit before tax of GBP 88 (USD 106.5) million for the financial year ending 31 December 2022, and its tangible equity is expected to be around GBP 1.4 (USD 1.68) billion. The assets and liabilities of SVB UK’s parent companies were excluded from the transaction, which will be funded from existing resources.

Recent Financial Performance

In late February 2023, HSBC released its 2022 annual results, showing strong financial performance and higher capital distributions. They announced a 50% dividend payout ratio projected for 2023 and 2024 as well as a return to quarterly dividends from Q1 this year. HSBC is also planning a special dividend of $0.21 to be paid in Q1 once the Canada disposal is completed as well as additional share buybacks. Finally, it indicated that it will also bring forward the announcement of buybacks to the Q1’2023 earnings results.

Share Price Performance

Over the last 5 years, investing in the ADR of HSBC Holdings PLC (NYSE:HSBC) has proven to be less than profitable for investors, with only marginal returns realized. Although in 2018, HSBC’s stock was performing well and traded around USD 55, the Covid-19 crisis in 2020 affected the entire market, and HSBC was not the exception, leading to a marked decline in its stock price. This was further exacerbated in September of the same year, because of a leak revealing that HSBC, alongside other banks, had allegedly moved large sums of illicit funds for almost two decades, despite alarms about the money’s origins. This situation resulted in a significant decline in investor confidence. Since then, the stock price of HSBC has fluctuated between USD 25 and USD 37. As of the date of this valuation, the current price stands at USD 33.24.

Five-year share price chart is shown below:

Source: Yahoo Finance, https://yhoo.it/42ogu9F

Valutico Analysis

We analyzed HSBC by using our Flow-to-Equity simplified approach, as well as a Trading Comparables analysis. The Flow-to-Equity analysis produced a value of GBP 116(USD 142.07) billion using a Cost of Equity of 7.6%.

The Trading Comparables analysis resulted in a valuation range of GBP 89.6 (USD 109.7) billion to GBP 123 (USD 150.6) billion by applying the median of the observed P/E and P/B multiples of the peer group. For our Trading Comparables we selected similar peers such as AIB Group plc, Lloyds Banking Group plc, NatWest Group plc, Standard Chartered plc.

Combining our Flow-to-Equity and Trading Comparables analysis results in a value range of GBP 88 (USD 107.7)  billion to GBP 120 (USD 147) billion. In comparison to BP’s market capitalization of GBP 112 (USD 137.2) billion we suggest that the company is fairly valued.

Link to the valuation

Disclaimer 

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post HSBC: Chance for Success or Misstep? appeared first on Valutico.

Weekly Valuation – Valutico | 6 March 2023

Link to valuation

About LVMH Moët Hennessy – Louis Vuitton

LVMH is a Paris-based luxury goods conglomerate. With a market capitalization of €395 billion, it is the most valuable company in Europe. Several luxury brands like Christian Dior, Givenchy, Fendi, Marc Jacobs and about 71 others are housed under the umbrella of LVMH. 

Recent Financial Performance

In late January 2023, LVMH released its 2022 annual report, posting record revenue and income levels. The company made €79.2 billion in revenue and €21.1 billion in profit from recurring operations in 2022, an increase of 23%in both metrics. In terms of business groups, the company increased revenue in the Wine & Spirits segment by 19% year over year and 25% in the Fashion & Leather group. Perfumes & Cosmetics increased by 17% and the Watches & Jewellery segment grew by 18% – an excellent performance across the board.. 

New Acquisitions and Famous Directors

LVMH has recently been linked with the acquisition of Aesop, an Australian luxury cosmetics, shampoo and body care brand. The acquisition price is roughly €2 billion but the company is facing stiff competition from other bidders, L’Oreal and the Japanese brand Sisheido. There have also been rumors about LVMH making a bid for the Swiss based luxury brand Richemont. Richemont is especially interesting for the conglomerate, as it owns Cartier, which would fit perfectly into the watches and jewelry business group of LVMH. The company has also been in the news lately as the long term CEO Bernard Arnault appointed popstar Pharrell Williams as the new head designer for the core brand LVMH. 

Share Price Performance

LVMH had an exceptional performance over the last five years on the Paris Stock Exchange. In early 2018 the company traded at €250 per share. After reaching new highs in early 2020 of €420 per share, the share price fell due to economic conditions and Covid-19. Since trading at €320 in mid 2020, the share price has more than doubled to its current level of €780 per share. 

LVMH’s five-year share price chart is shown below:

Source: Yahoo Finance, https://yhoo.it/3Sf5y84

Valutico Analysis

We analyzed  LVMH Moët Hennessy – Louis Vuitton by using the Discounted Cash Flow method, specifically our DCF WACC

 approach, as well as a Trading Comparables analysis. The Discounted Cash Flow analysis produced a value of €330 billion using a WACC of 9.3%.

The Trading Comparables analysis resulted in a valuation range of €305 billion to €492 billion by applying the observed trading multiples EV/Sales, EV/EBITDA, EV/EBIT and P/E. For our Trading Comparables we selected similar peers such as Burberry, Kering, Moncler and Hermes.

Combining our DCF WACC and Trading Comparables analysis results in a value range of €305 billion to €492 billion. In comparison to LVMH’s market capitalization of €395 billion we suggest that the company is fairly valued. 

Will the strong demand for luxury goods continue and therefore continue LMVH’s strong share price performance? Let us know in the comments.

Link to valuation

Disclaimer

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post Will luxury brand LVMH continue to outpace the stock market? appeared first on Valutico.

Weekly Valuation – Valutico | 21 February 2023

Link to valuation

About Alphabet

Alphabet Inc. is an American tech conglomerate, operating in various industries, including technology, advertising, autonomous driving, entertainment, and many more. The company is one of the world’s largest companies with a market capitalization of $1.34 trillion and competes via its famous subsidiary companies Google, Youtube and Waymo, amongst others. Recently the Google search engine was subject to many discussions due to rising perceived threats from Artificial Intelligence (AI) technology. 

Recent Financial Performance

Three weeks ago the company released its 2022 annual report, which showed strong revenue figures – growing by 10% to $283 billion compared to 2021. Despite this revenue growth, Alphabet was unable to maintain its healthy net profit margin, as net profit fell by around 5% to $75 billion. During this event, the company also published its fourth quarter results of 2022 showing an increase in revenue by 1% and a worrying decrease in revenues by 8% for the important YouTube segment. 

Chat GPT Threatening Traditional Search Engines

AI models like Chat GPT, provided by OpenAI, have the potential to disrupt traditional search engines as these models are able to provide more accurate and efficient information. Google proclaimed code red as this could lead to decreased usage of the company’s search engine, which is its highest revenue producing stream, contributing about 60%. However, Alphabet is also heavily investing in AI and could potentially integrate similar capabilities into its products to remain competitive. Last week, the company held a conference to talk about the threat of Chat GPT. There, Bard A.I., which can be seen as Alphabet’s answer to Chat GPT, was announced, but investors did not seem to be satisfied with Alphabet’s presented approach, as the share price has fallen by 10 % since then. 

Share Price Performance

Alphabet was an exceptional performer on the stock exchange over the last 5 years with a total increase of over 100%, even 200% before the recent pull-back. Currently the company is trading at $95 per share. Will Alphabet be able to leverage AI technology and therefore reach new heights soon?

Alphabet’s five-year share price chart is shown below:

Source: Yahoo Finance, https://yhoo.it/3jI8z5l

Valutico Analysis

We analyzed Alphabet Inc. by using the Discounted Cash Flow method, specifically our DCF WACC approach, as well as a Trading Comparables analysis. The Discounted Cash Flow analysis produced a value of $1,373 billion using a WACC of 9.9%.

The Trading Comparables analysis resulted in a valuation range of $1,517 billion to $2,344 billion  by applying the observed trading multiples  EV/EBITDA, EV/EBIT and P/E. For our Trading Comparables we selected similar peers such as Meta, Apple and Microsoft.

Combining our DCF WACC and Trading Comparables analysis results in a value range of $1,373 billion to $2,344 billion. In comparison to Alphabet’s market capitalization of $1,210 billion we suggest that the company is undervalued. 

Link to valuation

Disclaimer

This article is for informational purposes only and does not constitute investment advice. None of the information contained herein constitutes a solicitation, offer or recommendation to sell or buy any financial instrument.

The post AI technology, a serious threat for Alphabet? appeared first on Valutico.

• Investment from VC investors PUSH Ventures and aws Gründerfonds
• Investment & planned strategic partnership with Erste Group

Valutico, the web-based valuation platform, announces that it has closed its first financing round with outside investors. Existing investors also participated in the round, totalling equity funding in the mid 7-figures.

Investments from Venture Capital firms PUSH Ventures and aws Gründerfonds will make a substantial impact on the business, not only from a product and service perspective but also by gaining their invaluable expertise.

Vienna-based Erste Group is also participating in the financing round and intends to enter into a strategic partnership with Valutico to help further digitalize the bank’s processes around valuation and corporate lending.

Valutico will apply the funding raised in this round of financing to further accelerate its growth, deliver on its product roadmap, and grow its product and engineering teams. 

Valutico provides software for data-driven valuation analysis

Valutico serves the Financial Services and Investment Management industries with data-driven tools to conduct valuation analysis more efficiently. In an area dominated by slow and error-prone spreadsheets, Valutico empowers businesses and experts to perform accurate valuations in a fraction of the time it used to take while solving the issue of complex tools, lack of data sources and time-consuming reporting. Valutico’s globally distributed and fast-growing team of 60 employees currently proudly serves around 600 clients in over 85 countries.

Recent innovative product extensions of the existing valuation models, which currently focus on the financial value of a company, include the integration of the Capitalised Earnings Method and Venture Capital (VC) Method. But Valutico is also working on a robust qualitative and quantitative module for the holistic assessment of an organisation’s impact on the environment, society and governance (‘ESG’). 

Paul Resch, Co-Founder & CEO comments:

“The new funding rounds off an outstanding year for the company and will allow us to double down on our growth path and continue to innovate around the question of what “value” means in a business context. The benefits of Valutico’s platform are already being felt across the financial landscape and this recent funding helps us strengthen our offering and broaden our positive impact. We are using this opportunity to reinforce our commitment to our clients and we look forward to the road ahead!”

Laurenz Simbruner, Founding Partner at PUSH Ventures comments: 

“Paul and the team have shown an impressive track record building a fantastic product for a global audience of business customers. We are super excited to support Valutico on its way to becoming a world leader in the financial services software industry.”

Christoph Haimberger, Managing Director, aws Gründerfonds comments:

“Our investment allows Valutico to grow beyond legacy valuation tools, in ESG and digital usability. A value-driven combination of our investment thesis into “Green Winners” and “Digital Winners”. We are thrilled to be part of the journey with the outstanding and globally ambitious Valutico team.“

Ingo Bleier, Board Member for Corporates Banking & Markets at Erste Group comments:

“At Erste, we are committed to improving our ability to analyse and apply data in order to gain a better understanding of our customers’ needs and to develop our offering accordingly. That’s why we are exploring how Valutico‘s innovative valuation platform can help us to further digitalize part of our process in the corporate banking and underwriting business.”

Questions or any interest in the above? Then contact Alexandra Allason | a.allason@valutico.com

About Valutico

Valutico is the world’s leading valuation platform. Valutico’s all-in-one software allows finance professionals to value a company in minutes, by providing data-driven tools to conduct analyses faster and more accurately.

Used by more than 600 financial firms in 85 countries, Valutico is an emerging force in the world of business valuations. The powerful platform is popular amongst professionals in advisory roles such as in Corporate Finance, M&A, and Tax and Audit, as well as Investment Managers in Private Equity, Venture Capitalists, and Family Offices. Large corporations also use Valutico for Strategy, Financial Reporting, and Investor Relations.

Founded in 2017, and headquartered in Vienna with subsidiaries in the US and UK, Valutico operates worldwide with an ever-expanding network of valuation practitioners who use Valutico’s platform, consultancy services, and valuation trainings. Valutico’s mission is to make the complex process of company valuations simple, and to support accurate valuations for a well-functioning economy.

About aws Gründerfonds

The aws Gründerfonds is an Austrian venture capital company and has at its disposal investment capital of around 70 million euros. The investment focus is on Austrian startups with high growth potential for seed and follow-on financing in the start-up and early growth phase (Later Seed and Series-A). Co-investors from the international network are actively involved.  The aws Gründerfonds sees itself as a long-term, stable partner and offers entrepreneurial venture capital with active support. So far, together with co-investors, more than EUR 566 million have been invested in 45 companies, and numerous exits have been successfully completed.

About PUSH Ventures

PUSH Ventures is an early-stage venture capital firm investing in outstanding teams with convincing products and high growth potential. PUSH Ventures has been active as investor and has a strong belief in the megatrend of digitalisation and technological advances for the creation of value. Focus areas include health and the future of the planet in Europe, especially Austria and Germany.

About Erste Group

Founded in 1819 as the first Austrian savings bank, Erste Group went public in 1997 with a strategy to expand its retail business into the CEE region. Since then, Erste Group has grown to become one of the largest financial services providers in Central and Southeastern Europe, where it services around 16 million customers.

The post Valutation Software Valutico Secures Investment & Partnership appeared first on Valutico.

Weekly Valuation – Valutico | 7 October 2022

Link to the detailed valuation

About HP

HP Inc. is a US-based computer technology firm that develops PCs, laptops, and printers. The company also offers 3D printing solutions and sells related hardware products. 

Recent Performance

In terms of earnings, HP was able to meet the expectations of analysts in their third-quarter earnings call. HP reached the expected earnings of USD 1.04 per share. However, the company sold products worth USD 14.66 billion in the third quarter of 2022 and therefore was not able to meet the expectations of the analysts who estimated revenue of USD 15.69 billion. 

In their third quarter earnings call, HP also announced that they returned USD 1.3 billion to their shareholders as the company repurchased shares and paid out dividends. In terms of growth of the company’s segments, it was stated that consumer net revenue decreased by 20%, whereas the net revenue for business-to-business activities increased by 7% compared to last year’s third quarter. The net revenue of the printing segment was down 6%. However, HP was able to sell its printers and related products with a margin of 19.9%. This decline of 6% in the printing business is probably attributed to the current worldwide supply-chain problems. 

Poly Takeover and Remote Working

High hopes of HP investors are currently pinned on the Poly takeover which was announced on 29th August. Poly is a provider of workplace collaboration solutions with a focus on remote work. At the end of March, an agreement was reached on acquiring Poly for a value of USD 3.3 billion. The target company will receive USD 40 per share from HP. Due to that takeover, the PC and printer manufacturer wants to align its offer with the new trend towards remote working. Therefore, HP is able to offer a smooth integration between hardware and software. HP Inc. expects the acquisition to drive innovation and more robust growth in its peripheral and workforce business. 

Warren Buffet

HP Inc. also received attention in the news as star investor Warren Buffet bought USD 4.2 billion worth of the company in April 2022. Back then the price per share amounted to around USD 40. At the start of September, HP was traded at USD 30, which is a discount of 25% to the purchase price of Warren Buffet. HP is also interesting for long-term investors as they are offering an attractive dividend yield of just over 3%.

Valutico Analysis

Taking all this interesting information into account, we conducted a discounted cash flow analysis (DCF), which led to an attractive valuation of HP.  For this, we calculated a WACC of 6.4

%. With our DCF model–which we discounted with our WACC–we got a value of USD 79.3 billion for the enterprise. Our discounted cash flow analysis indicates a range of USD 63.9 billion to USD 107 billion. The company currently has a market cap of USD 26.9 billion, indicating HP’s strong upside potential. Therefore, we think HP Inc. is undervalued.

Link to the detailed valuation

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Weekly Valuation – Valutico | 30 September 2022

Link to the detailed valuation

Lockheed Martin Corp. is a US defense contractor. The company researches, develops, designs, manufactures, integrates, and operates technology systems, products, and services in the defense industry. Founded in 1995, Lockheed Martin Corporation is a Bethesda, Maryland-based aerospace company with a $106 billion market capitalization. 

The company published its Q2 2023 financial results this week. It narrowly missed analysts‘ expectations and the market punished it with a 5% drop in the share price within the first two days of publishing its results. The share has slid a further 3% since then to roughly $400 as of the date of publication. . 

Lockheed Martin stock has been a strong performer in 2022, gaining 13% compared to the broader S&P which has declined by 23%.  This reflects the robust nature of the company, considered one of the stock market’s favorite defensive stocks (stocks that are generally less sensitive to macroeconomic sentiment) to turn to during trying economic times. In the long term, the company’s average annual revenue growth rate is 8%. This is driven by the US government’s ongoing procurement of Sikorsky helicopter programs, AC-3, Long Range Anti Ship Missile, and the Joint Air-to-Surface Standoff Missile program. The company generates strong cash flow, with much of it being returned to shareholders via a healthy 2.6% dividend yield and an ongoing share buyback program. 

The company has margin expansion and better-than-expected free cash flow generation, despite the negative impacts of Covid and global supply chain disruptions on its business. Analysts expect the company to continue to grow sales at a slightly faster-than-inflation rate with margins expected to remain stable. 

Valutico Analysis

We conducted a fundamental analysis and performed a discounted cash flow (DCF) analysis based on historical data and analyst forecasts. A WACC of 5.7% was used as the discount rate which produced a valuation of $149 billion. Given the stable dividend payout ratio of ~65%, we also performed utilized a Dividend Discount Model with a Cost of Equity of 6.3% to arrive at a valuation of $103 million, almost exactly the current market cap of $106 billion.

Applying the Market Approach, we considered the trading multiples of comparable companies such as Northtrop Grumman, Raytheon and Leidos). These suggest that Lockheed Martin is somewhat undervalued compared to its peers by providing a valuation range of $124 to $150 billion.

Our final valuation range is thus $103 – $150 billion and we conclude that Lockheed Martin is likely undervalued.

Link to the detailed valuation

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