| On June 11, 2024, Circle announced that its Board of Directors had approved the 2024-2027 Strategic Roadmap, “Connect 4 Agile Growth.” This initiative aims to integrate cutting-edge IT product development with federated services to advance the logistics chain, with a particular focus on human capital. The 2027 strategic plan, built upon the Group’s unique market position, emphasizes “intelligent cooperation,” ensuring compliance with evolving regulations and fostering harmonious collaboration between logistics operators and industries on one side, and infrastructure systems and nodes on the other, within the EU/MED area. Based on the guidelines shared by the Company via press release, we are revising our estimates for both the current year and the coming years. Specifically, we estimate the Value of Production for FY24E at €15.70 million and EBITDA at €3.80 million, corresponding to a margin of 24.2%. For subsequent years, we anticipate the Value of Production will increase to €30.35 million (CAGR 23A-27E: 23.1%) by FY27E, with EBITDA rising to €7.95 million (corresponding to a margin of 26.2%), up from €3.19 million in FY23A (corresponding to an EBITDA Margin of 24.1%). We have conducted the valuation of Circle’s equity value using the DCF methodology and multiples from a sample of comparable companies. The DCF method (which prudently includes a specific risk premium of 2.5% in the WACC calculation) yields an equity value of €49.9 million. The equity value of Circle using market multiples results in €47.0 million (including a discount of 25.0%). This results in an average equity value of approximately €48.5 million. The target price is €10.50, with a BUY rating and a MEDIUM risk level. |