| In the consolidated financial statement as of December 31, 2023, Palingeo recorded revenues of €58.50 million, a 14.7% increase compared to the € 51.02 million from the previous fiscal year. The EBITDA for the period amounts to € 13.14 million, showing significant growth compared to the FY22A value of € 7.96 million and our estimate of € 11.05 million. The EBITDA margin stands at 21.4%, a strong increase compared to the 2022 figure (14.9%) and our previous estimate of 16.1%. EBIT stands at € 9.47 million, markedly improved from the € 5.42 million of the previous year (+74.7%). Net Income is at € 6.71 million, an 84.3% annual increase compared to the previous year’s € 3.64 million. In light of the results published in the annual report for FY23A, we modify our estimates both for the current year and for the coming years. In particular, we estimate the value of production for FY24E at € 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 up to € 80.75 million (CAGR 23A-27E: 7.0%) in FY27E, with an EBITDA of € 17.85 million (corresponding to a margin of 22.1%), growing compared to € 13.14 million of FY23A (corresponding to an EBITDA margin of 21.4%). 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 € 84.1 million. The equity value of Palingeo using market multiples is € 74.5 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. |