Swissquote is a must-have (Swissquote Group Holding)
Swissquote is a must-haveTARGET CHANGE
CHANGE IN TARGET PRICE CHF 230 vs 199 +15.6%
Our Target Price increases materially on the back of our NAV adjustment (see explanation below) and the reshuffling of our panel of peers.
Initially using peers such as LSE, Deutsche Boerse and Julius Baer to capture the firm's exposure to financial markets, we now use much more similar peers as the sector matures. The panel of peers is now composed of Avanza, Nordnet, flatexDEGIRO, Smartbroker Holding AG and sino AG. We have applied modest discounts to the high multiples of this new universe.
CHANGE IN NAV CHF 230 vs 152 +50.7%
Our Net asset value has been significantly increased on the back of a change in valuation methodology. As depicted in our paper "Swissquote's hidden value", we have valued the firm stripping out the crypto business.
We estimate an EBITDA of c.277.7m in 2023, excluding crytpo, to which we apply an 11x multiple and an EBITDA of c.3m for FY 23-25 on the crypto business to which we apply a 3x multiple (given the high unpredictability of the asset class and the questions concerning its underlying sustainability).
Swissquote Group Holding is engaged in the provision of Online Financial Services. Co. provides online securities trading services (including custody services) and quantitative asset management services (ePrivate Banking among others) to self-directed private investors, independent asset managers, investment funds, and third party financial institutions. Co. provides access to over-the-counter FX markets through in-house technology platform to retail customers, money managers, and third-party financial institutions. In addition, Co. operates an online bank that accepts deposits in the form of current accounts and saving accounts from its customers.
AlphaValue Corporate Services capitalise on the research and credit analysis expertise deployed by AlphaValue with major institutional investors at European level over the past nine years. The proprietary tools and processes enabling AlphaValue Corporate Services to establish a valuation and/or a credit risk assessment are identical to those used by AlphaValue to the benefit of its institutional clients. The only difference is the recognition that a company evaluation cannot be dissociated from the fact that the latter is paying for the service (AlphaValue Corporate Services), as opposed to the investor footing the bill (AlphaValue). AlphaValue’s research tools are characterised by the transparency of the valuation methodologies, their responsiveness to market data and by nine years’ experience of a universe numbering more than 450 European companies. Through its coverage and sector exhaustiveness, AlphaValue ranks alongside the major research houses in Europe and constitutes the only new entrant to the European space in the past decade. This significant presence is reflected in an unrivalled distribution capability via platforms commonly adopted by investors to access research: Factset, Bloomberg, Capital IQ and the numerous websites. AlphaValue is one the largest research contributors to these platforms, to the benefit of AlphaValue Corporate Services issuer clients. The AlphaValue Corporate Services analysts are AlphaValue’s sector specialists. Their robust knowledge of the business models in their sectors enables the rapid generation of incisive, relevant research and advantageous interaction with the management teams.
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