Wirtualna Polska: Let’s ride the wave of e-commerce (stays BUY)
We maintain our BUY rating on Wirtualna Polska (WPL), and raise our 12M price target (PT) to PLN 80.0/share, from PLN 66.5/share, implying 16% upside potential. Despite the 31% ytd appreciation of WPL’s share price, we remain optimistic on the stock, considering its growth outlook (a 17% 2018-21E adjusted EBITDA CAGR), driven by the strong performance of its e-commerce businesses and the still decent online ad market growth (at 8.5% in 2020E vs. 10% in 2019E, on our forecasts), which should support the media business. Moreover, we believe that, next year, WPL might decide to sell the TV business, after it finally reaches breakeven; we believe this would be a strong trigger for the stock. We also highlight that WPL does not seem expensive on multiples: it is trading at 2019-20E EV/EBITDAs of 11.3-9.5x, on our forecasts, implying 18-12% discounts vs. its peers.Wirtualna Polska Holding SA is a Poland-based holding company. The Company owns entities that are engaged in the Internet publishing and broadcasting content, including operating business, technology, sports and entertainment portals, as well as electronic mail (e-mail) and electronic commerce (e-commerce). It also offers a range of advertising products, including display ads. The Company operates through such Internet portals as Wirtualna Polska, o2.pl, Money.pl, WP SportoweFakty, Dobreprogramy.pl, WP Parenting, Domodi and Homebook, among others. The Company operates domestically.
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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