| In the consolidated financial statements as of June 30, 2024, Palingeo reports revenues of €33.13 million, an increase of 28.7% compared to the result of €25.74 million for the same semester of the previous year. The EBITDA for the period amounts to €6.93 million, reflecting a notable growth of 66.3% compared to the figure of €4.17 million in 1H23A. The EBITDA margin stands at 20.0%, a significant increase from the first semester of 2023 (15.3%). EBIT, after depreciation and amortization of €1.88 million (including provisions for risks amounting to approximately €0.50 million), amounts to €5.06 million. As a result, the EBIT margin is 14.6%, compared to 9.9% in 1H23A. The Net Income amounts to €3.30 million, an increase of 70.9% compared to the first semester of 2023, which was €1.93 million. In light of the results published in the semi-annual report for 1H24A, we confirm nearly all of our estimates for both the current year and the coming years. In particular, we confirm a Value of Production for FY24E of €71.45 million and an EBITDA of €15.35 million, corresponding to a margin of 21.5%. For the following years, we expect the Value of Production to increase to €80.75 million (CAGR 23A-27E: 7.0%) in FY27E, with EBITDA reaching €17.85 million (corresponding to a margin of 22.1%), an increase from €13.14 million in FY23A (which corresponds to an EBITDA margin of 21.4%). On the asset side, we estimate a positive Net Financial Position (NFP) of €9.71 million for FY27E. We conducted the valuation of Palingeo’s equity value based on the DCF methodology and the multiples from a sample of comparable companies. The DCF method (which includes a prudential specific risk of 2.5% in the WACC calculation) yields an equity value of € 77.9 million. The equity value of Palingeo using market multiples is € 80.6 million. This results in an average equity value of about € 79.3 million. The target price is € 12.00, with a BUY rating and MEDIUM risk. |