MoneyMe IPO, page-4

Done some analysis on MM

BENCHMARKS

Used Afterpay and Prospa. Also looked at Latitudenumbers, Flexigroup and a few USA Latitude look a likes for a reality check.

PROFITABILITY

Only Money Me forecasts to make a small profit in 2020.

EBIT to total revenue for Afterpay 11% , Prospa 12%and MM 30%.

MM performs very well here.

Afterpay bad debt write off at 22%, Prospa at 24%and MM 28%.

All surprisingly similar.

Interest Expense to Revenue , (cost of funds) is22% for Afterpay, 17% for Prospa and 28% for MM.

As MM gets bigger you would think their funding costswill drop .

BALANCE SHEET MEASURES

Equity to total assets for Afterpay 79%, Prospa 31% andMM 34%.

If I compare EBIT to total assets then Afterpay at3%, Prospa at 3% and MM at 11%.

MM is a very good performer here.

PRICING

After Pay is stratospheric relative to everyone.

Prospa also very high .

Money me at $1.25 is very reasonably priced even for atech stock.

Could even suggest they couldhave priced MM higher for this IPO.

Unless I am really missing something .

AFTERPAY

So why does the market like this model.

I have not looked at its financing model in depth but itgenerates 32 cents in revenue for every $1 in assets. This compares withLatitude at 15cents, Flexigroup at 15 cents , BOQ at 4 cents.

USA benchmarks in range of 8 to 20 %.

In short, look at the classical old bank , BOQ at 4 centsversus Afterpay at 32 cents.

If Afterpay gets this right they should make a lot ofmoney as their asset base is a lot more productive in generating revenue.

Now, if you look at Prospa, it generates 27 cents inrevenue for every $1 in assets and MM does 36 cents.

Again, MM a very good performer on this metric.

OTHER COMMENTS

MM is the smallest revenue at $46m, After Pay $264m andProspa at $128m.

CONCLUSION

Valuing MM as a tech stock with potential then reckon itis worth around $1.50 to $1.80.

Would also not surprise me if it hits $2.

Even at the above price predictions it is stillsignificantly cheaper than Prospa and Afterpay.

I will be bidding for stock and good luck to everyone

Any other views ?