Thursday, April 28, 2021
Forbes Global Media: A Compelling Growth Story
Michael Kupinski, Director of Research, Noble Capital Markets, Inc.
Refer to end of report for Analyst Certification & Disclosures
Noblecon 18 highlights. Forbes CEO, Mike Federle, and CFO, Mike York, presented at Noblecon18, speaking on several topics, such as Forbes recent strong results and outlook for 2022, the impacts of Forbes’ brand elasticity on its growth prospects, how the company plans to leverage its in-house technology stack, a strategic investment from Binance, and when the SPAC merger is likely to close. The full video of the presentation can be found here.
2022 pacing well. Management stated that 2022 is off to a good start and expects a strong year of growth. Our full year 2022 revenue estimate is $290 million, which assumes 12% growth over 2021.
Technological advantages. During the presentation Forbes management stressed the importance of modern media companies having a strong technological foundation. Forbes has such a foundation with its analytics platform, ForbesOne, which gathers over 600 data points per user. This data allows the company to identify audience cohorts to improve content offerings as well as increase the value proposition for advertising partners.
SPAC merger update. The SPAC is expected to close by May 31. Upon the completion of the merger, shares of the SPAC (OPA) will convert to common stock of Forbes Global Media (FRBS).
Attractive valuation. Near current levels, the OPA shares trade at 9.4 times enterprise value to expected 2022 EBITDA and 7.5 times EV to expected 2023 EBITDA. Our price target of $16 represents a 60% premium to near current levels and a target EV/2022 EBITDA multiple of 16.5 times.
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ANALYST CREDENTIALS, PROFESSIONAL DESIGNATIONS, AND EXPERIENCE
Director of Research. Senior Equity Analyst specializing in Media & Entertainment. 34 years of experience as an analyst. Member of the National Cable Television Society Foundation and the National Association of Broadcasters. BS in Management Science, Computer Science Certificate and MBA specializing in Finance from St. Louis University.
Named WSJ ‘Best on the Street’ Analyst six times.
FINRA licenses 7, 24, 66, 86, 87
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| NOBLE RATINGS DEFINITIONS | % OF SECURITIES COVERED | % IB CLIENTS |
| Outperform: potential return is >15% above the current price | 99% | 28% |
| Market Perform: potential return is -15% to 15% of the current price | 6% | 3% |
| Underperform: potential return is >15% below the current price | 0% | 0% |
NOTE: On August 20, 2018, Noble Capital Markets, Inc. changed the terminology of its ratings (as shown above) from “Buy” to “Outperform”, from “Hold” to “Market Perform” and from “Sell” to “Underperform.” The percentage relationships, as compared to current price (definitions), have remained the same.
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Report ID: 24770