Vercom: solid growth, boosted potentially by M&A (upgraded to BUY)
We have upgraded our rating on Vercom to BUY (from Hold), and raised our price target (PT) to PLN 150.5/share (vs. PLN 139.8/share previously). We see Vercom as an outstanding growth story, based on its healthy organic global customer base expansion. On our forecasts, the company should deliver a 2024-27E adjusted EBITDA CAGR of 22% (broadly in line with the company’s targets, included in the incentive scheme) and a net income CAGR of 26%, driven by top-line growth, profitability improvements and deleveraging. Vercom’s story might also be spiced up by M&A – the company plans to spend PLN 1bn on M&A by 2028E. On our forecasts, Vercom is trading at 2025-26E EV/EBITDAs of 18.7-14.8x, at 11-20% discounts vs. its peers.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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