Agree with your approach plich. Cyan's bid effectively values...

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kamikara

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14/05/24

01:33

Post #: 73806748
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Originally posted by pilch: ↑

Also in receipt of the email. From a market research co. 1 interesting question was, effectively, what do you put most weight on to make your decision.

Tidewater is a company operating in a similar space, BTIG released a note on 10/5/24 forecasting an adjusted Ebitda:EV ratio of x 9.7 for 2024 [31/12/24 basis]

By way of comparison MRM recently announced an updated figure of $136-142 million for the yr to 30/6/24. Using the mid point $139 figure to be conservative x 9.7 = $1348 for the MRM EV. MRM has +$67m on the balance sheet,[current assets- total liabilities] so the EV currently is A$1415m divided by 390 m shares [includes share rights] = A$3.63 per share on a comparative valuation.
But Tidewater has inferior assets to MRM as it does not have the govt or defence work that MRM has. In addition, for the sharp eyed the Tidewater figures are for the year to 31/12/24 and MRM for the year to. 31/06/24 ie Tidewater's include an extra 6 months growth. Furthermore MRM has a fast growing renewables niche, providing diversification and earnings stability benefits.

A 10 % premium to the Tidewater figure seems conservative.

So a reasoned current valuation for MRM is A$3.99. [remember the company has some valuable franking credits on top of this.
The usual change of control premium is around 30%. Thus a reasoned target price is A$5.19
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Agree with your approach plich. Cyan's bid effectively values MMA's fleet at ~1x replacement cost - a total steal.

Hopefully the takeover battle sheds light on this company and we can get some institutional capital onto the register. It's still trading at such a cheap valuation despite the takeover offer.

Last edited by kamikara: 14/05/24

MRM Price at posting: $2.72 Sentiment: None Disclosure: Held
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0 Great analysis

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