In May 2020, an article from a Frankfurt based investment bank
reported an analysis of the valuations of cyber security
companies between 2006-2019 in terms of EV/sales and EV/EBITDA.
https://ma-review.com/cyber-security-an-insight-into-the-sector/m a - r e v i e w . c o m /
(see sec. 6.1)
The article showed that in 2019, the average EV/sales was 5.5 , the EV/EBITDA was 25.3.
Here's a comparison with the latest EV/Sales numbers (late 2020) for some US players and several
ASX cyber companies, including TNT :
EV/Sales
FTNT.........10
CYBR........14
CHKP..........8.8
JNPR..........1.9
CSCO.........3.9
QLYS........14
WHK.........58
FZO..........10
AR9..........73
NXL..........20
TNT............5.8The TNT number I've based on the annualised FY21 Q1 revenue (=$60.6m).
TNT currently has the lowest EV/sales ratio of all the ASX cyber stocks.
If TNT achieves the base scenario revenue of $28m for FY21 Q2 (or $112m/y) which seems highly likely,
its EV/sales ratio would be 3.2. This would also make it's valuation -40% below the sector average.
From any angle, TNT is looking well undervalued as a cyber stock.
All IMHO, DYOR
