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SNAP looking sharper …as Cashflow triples
Current 25 Target 43 +77%
February 4 2022
1 minute read
Sales grew 22%
Costs down profit turns positive
Cashflow tripled
Balance sheet higher leverage
Valuation, a 77% higher target price
1 minute read
Sales grew 22%
- Sales grew 22% in the fourth quarter to 1,298 million dollars vs our 1,334 million dollars forecast.
- This brings the quarterly average to 11% growth.
- We predict average growth of 6% in this next 12 months to bring sales to 1,602 million dollars in the fourth quarter of 2022.
Costs down profit turns positive
- The cash cost ratio went from -86% to -77% profit turned positive from -72 to 23 million dollars in the fourth quarter.
- The average cost ratio is at -90% now.
- We use an -82% cost ratio to predict a 19 million dollars profit in the fourth quarter of 2022.
Cashflow tripled
- Free cashflow trilpled from 52 to 161 million dollars in the fourth quarter with -25 million dollars investment Cashflow.
- Average quarterly Cashflow is at 56 million dollars now.
- We assume the same -25 million dollars investment spending which with higher sales gives a 267 million dollars Cashflow in the fourth quarter of 2022.
Balance sheet higher leverage
- Cash increased 1,972 to 1,994 million dollars in the fourth quarter.
- Liabilities increased 3,671 to 3,746 million dollars so net cash worsened slightly -1,699 to -1,752 million dollars.
- With our forecast cashflow & a -6 million dollars equity payout -695 million dollars liabilities payment net cash will be -900 million dollars in 12 months time.
Valuation, a 77% higher target price
- SNAP capital raised from the last 24 quarters worsened slightly -6,606 to -6,609 million dollars in the third quarter with 3 million dollars new equity but will be -5,909 million dollars in12 months time.
- At the current market value of 39,440 million dollars based on our forecasts it’s at 6 X assets with a 6 years payback & a 0% yield.
- Our cashflow forecast is 873 million dollars which means an 45 X valuation. An 80 X valuation gives a 77% higher target price of 43 dollars.