TMV GR

TeamViewer AG - Bearer Shares

TMT


Presented:11/02/2020
Price:€37.15
Cap:$8.32B
Current Price:€12.08
Cap:$2.10B

Presented

Date11/02/2020
Price€37.15
Market Cap$8.32B
Ent Value$7.71B
P/E Ratio73.33x
Book Value€0.46
Div Yield0%
Shares O/S201.07M
Ave Daily Vol690,657
Short IntN/A

Current

Price€12.08
Market Cap$2.10B
TeamViewer AG is a holding company, which engages in the development and operation of a global connectivity platform. It offers software solutions in order to connect computers and mobile devices, which allow remote control, management, and interaction between people and devices, people and people, as well as devices and devices. Its platform provides full remote access and control functionalities for connected devices. It also offers remote device management with features that enable efficient management and control of endpoints in networks with multiple IT, Internet of Things, and mobile devices. The company was founded in 2005 and is headquartered in Goeppingen, Germany.

Publicly traded companies mentioned herein: Dropbox Inc (DBX), Sage Group PLC/The (SGE LN), TeamViewer AG (TMV GR)

Highlights

The presenter is short shares of TeamViewer AG (TMV GR), an infrastructure software business headquartered and listed in Germany. TMV’s value proposition is that its software allows users to control a computer or smartphone from another computer and works across different operating systems. While this technology facilitates several use cases, the primary commercial application is for remote assistance (i.e., IT help desks). The company has historically followed a freemium business model and had 534k subscribers as of August 2020, mainly comprised of individuals and small businesses. The stock trades at ~€38 per share with a market cap of ~€7.5B and two turns of leverage. This implies forward revenue and forward EBITDA multiples of ~15x and ~25x, respectively, which the presenter views as a relatively rich valuation. He views the company as overvalued in part due to his belief that the company is using aggressive business tactics and financial reporting to transform organic declines in usage into 30%+ billings growth. He considers this unsustainable and models ~25% downside to 2022 billings estimates and ~50% downside to the share price as its EBITDA multiple contracts to ~15x, in line with DBX.

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