Rhythmone Share Discussion Threads

[geheimnis2] 27/3/2017 17:09

red or blue, loops?

[barkboo] 27/3/2017 17:00

Loopy - are your eyes bloodshot? Perhaps you see magenta? lol

[loafofbread] 27/3/2017 16:12

Difficult for us in the cheap seats to know what's going on.

However, if Tosca had any concerns they would have sat at 23% and been done with it.

As it is, they have spent another £13M at current prices to control the table.

Their end game is much higher than 43p, which ever way you slice it.

[sikhthetech] 27/3/2017 15:57

knowing,
yes...
House broker, Numis 52p, Singer 65p... both Buys...

even using a revenue multiplier based on Tead, currently points to around the 50p-65p mark (not 100p/200p), if 1R can back up their recent comments and produce a good outlook statement... If they can beat the results expectations and deliver a decent outlook statement addressing the challenges facing the industry then the share price will take care of itself...

we'll know in 2-3 weeks...

[knowing] 27/3/2017 15:45

Singer have a 65p BUY target

[sikhthetech] 27/3/2017 15:33

1gw,

Obviously, Tead and 1R are completely different businesses. I wasn't implying a straight forward multiple to apply to both or any other companies... it's a rough idea as to what multiple was applied on a recent sale...

1R paid < 1 x Perk revenues, didn't they? So it doesn't mean 1R or any other is valued at 1 x revenue... I haven't implied that, have I??

As to Perk, the 9month revenues you mentioned inc India and Corona... Given they have withdrawn from India and Corona was sold off, it's not a figure to rely on, is it?...

Tead having 4 yrs positive EBITDA is relevant, isn't it?


Let's see if 1R can back up their comments when it comes to providing us with the figures and outlook...

[1gw] 27/3/2017 15:25

Past debt/equity raises are irrelevant STT. They both need to be ignored, which I think is what I said.

The point LCWA originally brought up was that Teads had recently raised debt - and so by implication may still have some on the balance sheet, while R1 and Peak both have net cash/securities in the bank.

This point is very relevant to the valuation, don't you agree?

And since you seemed to be looking for an equivalent valuation for R1/Perk I was trying to provide one. Since TEADS was valued on 2016 revenues, the most straightforward analysis for R1 is to estimate R1 and Perk revenues for 2016, add them together, multiply by the TEADS multiple and then add on the net cash/securities.

Since Perk was bought towards the end of FY17, FY17 R1 revenues including Perk are most definitely not appropriate for this analysis. You need to include estimates of the full-year Perk revenues and full-year R1 (excl Perk) revenues. Any acquirer would then make an assessment of whether the whole was greater or less than the sum of the parts - i.e. should it apply a higher revenue multiple or discount the revenue multiple for revenue dissynergies. Note that TEADS was also acquiring companies, but I haven't got the willpower to try to track down how material they were in the context of 2016 revenue.

It was you who started down the road of trying to read across from the TEADS price to an R1-equivalent valuation. So I was just playing along with that idea. The reality I suspect is that TEADS and R1+Perk are very different businesses and there is no easy read across from one to the other.

[sikhthetech] 27/3/2017 15:19

also 1R bought Perk for < 1 x revenue, didn't they?

[sikhthetech] 27/3/2017 15:16

lcwa,
lol

I didn't say that, did I? so stop twisting it... the Chinese were paying much higher...

Teads was recently sold @ 1.5 x revenue... yet they had 4 yrs positive EBITDA...


How many years positive EBITDA does 1R have???

[leluot3] 27/3/2017 15:16

rocket fuel
25 Mar '17 - 19:55 - 5658 of 5671 2 0

heard this is gonna go orbital next week.


Any chance you going with it and taking those prize monkeys gimp and bark with you?

Do us all a great favour.


Now lets see - red again

[lance corporal winstanley ash] 27/3/2017 15:13

Stt. So going forward should every takeover target be valued at 1.5x revenue?

[sikhthetech] 27/3/2017 15:03

1gw, whether it's relevant or not, it needs to apply on both cases, isn't it.. it can't be applied to one and not the other...

The fy 2017 expectation is $180m + approx $70m cash...
$180m x 1.5 = $270m
+ cash = $340m


when a company wants to asses how risky a buy is, the number of years trading, especially profit, even positive EBITDA is relevant, isn't it...

House Broker target 52p.

[1gw] 27/3/2017 14:55

It's irrelevant how much debt or equity they've raised in the past isn't it? It's how much cash or debt is on the books at the point of acquisition and perhaps whether they are expected to be cashflow positive or needing funding going forward.

"The acquisition values Teads at an enterprise value of up to €285 million on a cash and debt free basis"

"Teads revenue grew by 44% in 2016 to an estimated €187.7 million."


285/188 = 1.5 (approx.)

R1 cash/securities at end Sep'16: $69m
Perk cash at end Sep'16: $10m (net of loans and borrowings)
So R1+Perk c. $79m net cash & securities at end-Sep'16

So the equivalent valuation of R1 would be $79m + (1.5 x 2016 R1 & Perk revenues) wouldn't it (note that Perk trade receivables at end-Sep'16 were greater than total liabilities other than loans and borrowing)?

$53m Perk revenues 9 months to Sep'16
$70m-80m Perk full-year revenues?
$170-180m R1 (excl. Perk) FY17 revenues ($80m in 1HFY17)?
$240-260m R1 + Perk full-year revenues pre-acquisition.

All of which would give an enterprise value of a slightly implausible $450m or so (i.e. $79m + 1.5x250).

We know Perk was actually valued at $42.5m (based on R1 consideration), so a lot less than 1.5 x 2016 revenues even without adjusting for net cash.

[barkboo] 27/3/2017 14:45

"sm001,
lol

Teads still sold for around 2 x revenue, even if your debt amount is correct....
So what about the $167m 1R raised??


1R revenue expectation is $180m... so you do the maths...
House Broker target 52p...

all leading to around 50p-60p


How many years positive EBITDA does 1R have?"

-----------------------------------
So Johnny Boy - do you rate RTHM a sell or a buy at this moment in time?

[football] 27/3/2017 14:39

sm001 and kendo get ready for the spamming to hide your last two posts

[sikhthetech] 27/3/2017 14:38

sm001,
lol

Teads still sold for around 2 x revenue, even if your debt amount is correct....
So what about the $167m 1R raised??


1R revenue expectation is $180m... so you do the maths...
House Broker target 52p...

all leading to around 50p-60p


How many years positive EBITDA does 1R have?

[kendonagasaki] 27/3/2017 14:29

Selective memory....Eh Jon Jon?

[sm001] 27/3/2017 14:04

stt... yep you are correct it is listed in the header that Blnx/R1 has previously raised cash... but you were asked a straight forward question as to whether Teads had any debt and you didn't respond? Strangely, you then forgot to add the additional $47,000,000 debt incurred by Teads that was shown in my post?

hahaha!

[wheeze] 27/3/2017 13:20

perhaps the success of their Rhythminfluence programs ?If you take a look athttps://www.rhythmone.com/assets/insights/RhythmOne_FullYear2016InfluencerBenchmarks.pdfyou may find some answers.

[sikhthetech] 27/3/2017 12:27

wheeze, what was the explanation for the rise in quantcast?

[wheeze] 27/3/2017 11:48

R1 appears to have found a new level on Quantcast. I have yet to see a convincing explanation for this fall ?

[sikhthetech] 27/3/2017 11:38

sm001,

Look at the header, 1R raised $167m... and have how much cash left, approx $70m???

So, Teads raised $30m, which is 10% of the price they were sold at, $307m...

[sikhthetech] 27/3/2017 11:31

obviously, Teads is not 1R but they're not Google either... They were bought for approx 1.5 x revenue and had 4 yrs of positive EBITDA..

How many years of positive EBITDA do 1R have????

[sm001] 27/3/2017 10:16

LCWA

..I'm not an accountant so perhaps someone else can verify this, but a quick Google search shows the following: (from August 1st 2016)

"Video advertising platform Teads has raised a further $47 million in debt financing...it last raised $30,000,000 in January 2015..."

[kendonagasaki] 27/3/2017 10:16

How much debt Sikh??