Carnegie Investment Bank
eEducation Albert
Date Title Alternative
2024-05-14 Another challenging quarter Download | Show Close
2023-11-24 Steps towards profitability Show Close
2023-10-04 Change in revenues not reflected in valuation Show Close
2023-08-24 Impressive B2B revenues Show Close
2023-05-30 Healthy cash flows and steps towards profitability Show Close
2023-04-21 Reduced revenue volatility not reflected in valuation Show Close
Research | 21 Apr 2023 | eEducation Albert

Reduced revenue volatility not reflected in valuation

 

New revenue mix following major acquisitions…

Following completion of Albert’s acquisitions of Film och Skola and Strawbees, the company’s revenue mix has moved from some 82% B2C and 18% B2B to B2C at 60% and B2B at 40%. B2B revenues see lower churn, but sales cycles are longer. The company’s recent focus on targeting larger school groups has started bearing fruit. At the end of the quarter, it signed an agreement with SBCSC, a school group in Indiana, US. The agreement entails an ARR contribution of USD 57,000, or around 2% of B2B ARR as of the end of Q4 2022.

…which is not reflected in valuation…

Albert is currently valued at a NTM EV/Sales of 0.5x – its lowest level since the IPO. This valuation is considerably lower than for companies with consumer-oriented subscription services, which are valued at present at NTM EV/Sales of 1.5x. The software companies we use as the basis for our valuation modelling are at NTM EV/Sales of 4– 6x. Historically, Albert has been valued in line with or at a smaller premium to other subscription-based consumer services companies. Given that the company now has a 40%/60% B2B/B2C revenue mix, we believe it should, in the long term, move towards software company valuations.

 

…but is reflected in fair value

We maintain our SEK 52–54 fair value and believe that, through its recent acquisitions, the company has taken a large step towards its financial target of SEK 500m in net sales in 2025. We see the increased share of B2B revenues reducing revenue volatility and easing the company towards profitability as marketing comes to represent less of revenues, thus justifying an expansion of multiples.

 

Download (EN)
2023-03-07 Acquisitions push company closer to goal Show Close
2022-11-03 Big stride towards financial targets Show Close
2022-07-19 Strong growth during the quarter Show Close
2022-03-17 A European market leader Show Close

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