Incredimail (MAIL) Ups Guidance

Posted on July 21, 2009

As we predicted in an earlier post, MAIL would easily beat its guidance for 2009. Today, MAIL announced that it expects to exceed $9 million in EBITDA in 2009, up from previous expectations of $7 million, and up from virtually nothing last year.

From a valuation standpoint, despite MAIL’s rise the year, the stock still appears very cheap. On an enterprise value (after subtracting cash), the company is valued at about $35 million. This is against $9 million in EBITDA, or about a 4X multiple. This is extraordinarily inexpensive for an Internet advertising business, with many of the comparable companies trading at significantly higher multiples, despite slower growth than MAIL and greater financial risk. Even at a modest 10X multiple, MAIL would be valued at $12, or about double the current price.

Disclosure: Affiliates of Envoy Global Research, and its principals, own shares in MAIL. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.

Comments and Discussions

The section below is intended to serve as a forum for intellectual debate about particular investment ideas or theories. Please refer to this section for any updates on a particular investment idea. If you have your own thoughts, please feel free to add them. We appreciate your feedback.

If you would like to make a comment, please fill out the form below. Please note that we only require an email for editing purposes. We will NEVER publish your email or use it in any way.

Subscribe for FREE

Enter your email below to receive free research summaries.

RSS Feeds:

Quick Links

Recent Comments:

Yehuda Hi Thomas, "the obvious way to modify a mortgage is to leave the principal alone, stretch out the... >>Read More

Thomas J. Costagliola Yehuda, Maybe it is just me, but it seems that the obvious way to modify a mortgage... >>Read More

Thanks Appreciate your reply. Perhaps the challenge of estimating the degree to which given expectations... >>Read More

Yehuda Fruchter I agree, "better than expected", which is why it is important to only look at distressed... >>Read More

Thanks Thanks. The quote is a great reminder of Lynch's approach. Should it be qualified somewhat: "If... >>Read More

Disclaimer:
This site may include market analysis and we may own shares in the stocks mentioned in our reports. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.