MIL paid around 4x ebitda for codee, this is significantly higher than its own multiple of around 2.5.
To me this highlights that MIL is undervalued, you could not buy much even in the private sector for 2.5 times,
as RAAS highlights MIL peer group is on 4.6 times ebitda, there is room for our multiple to expand, even if we get to our peers average that is around 1.20.
From the quarterly, they spent 800k on due diligence, this would suggest to me that they are closely looking at a bolt on to boost growth, this would be entirely consistent with what i heard from the ceo and cfo a number of months ago on a podcast, this industry is highly fragmented and ripe for consolidation, i would suggest that any such purchase of a rival will shine the spotlight on how cheap MIL is.
Given that they now have Cannacord on board, and to this date there has been no coverage put out, i cant help but feel we are due some news, and maybe Cannacord are waiting for that to drop before pushing the stock,
either way i would be happy to crank out around 5.5 to 6 million ebitda for the half, this would a good result given the challengers over the last few months, as ever the actual margins will very interesting.
MIL Price at posting:
61.0¢ Sentiment: Hold Disclosure: Held
