With the recent launch of Spotify, we have examined SPOT’s peer group including Netflix, Sirius XM and Pandora. We found a strong relationship between the Customer LifeTime Value added (CLTV added TTM) and Customer LifeTime Value (CLTV TTM) and the dilutive market capitalization of these companies. Target Price Calculation Based on the accumulated and relative data of its online media competitors, we believe Pandora is a BUY. In the potential (probable) absence of no future operating profit, we believe Pandora can be valued using a similar valuation model as Spotify. Using Netflix, SiriusXM, Spotify and Pandora, there is a strong […]
Daily Archives: Monday, May 7, 2018 5:15am
2 posts
Shopify’s (SHOP-NYSE) share price continues to fluctuate as questions about future gross margins, churn, and valuation continue. We take a unique approach to Shopify’s subscription valuation in order to account for its Merchant business that accounted for 36% of gross margin dollars (TTM). What Moves SHOP’s Share Price and how has it Traded? Source: Perspectec Shopify’s gross margin profile, subscription churn (based on our survey) and operating expense put Shopify as a very expensive stock relative to its peer group. Getting a Clean Shopify SaaS Valuation We believe Shopify’s valuation should be based on its relative SaaS valuation. We do not see a path to a […]