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They might be selling, who knows, but BGO don’t need to raise any money to pay off the debt - it’s being repaid from cash flow over the next couple of years.

Singer’s note is very similar to CG’s - they have a 179p sun of the parts valuation based on 11x EBITDA for DCB and 3.6x Sales for DVM. Again these are “derisked” so clearly based on cautious guidance from Bango.

Singer quote competitor metrics, with an average EV/EBITDA of 14.6 for payment processors and 2.3x for their DVM comparators. They also state that EITHER of the two revenue streams could justify the current share price.

Again, you’d have to say - there is a massive disconnect in valuation between Bango and others. Surely, sooner or later, it will re-rate.

CG have published an updated research note today. Their valuation of 181p and continued Buy recommendation is based on a certain amount of “derisking” to reflect the current macro environment. They have revenue increasing marginally to $53.9m and Adj EBITDA moving from $16.4m to $19.4m. They comment that the visibility and quality of revenue is much improved.

“FY27E, we forecast Bango to have two 'Rule of 40' businesses on an adj EBITDA basis. We believe this outcome is not currently reflected in Bango's valuation. We update our target price following the new segmental reporting this morning, and apply our previous target multiples of 10x Payments EBITDA and 3x Subscriptions revenues to our new FY26E segmental forecasts. This generates a new 181p target price, 15% below our previous 212p target (on FY27E, it would be near 200p). We reiterate our Buy rating and our new target price implies a >2x opportunity.”

Reading this - and in the belief that CG’s valuation metrics are fair - you’d have to say the problem is not so much with the company but the market’s appraisal of it.

Tbf DVM revenue was up almost 30% and DCB revenue was up for core routes at a rate very similar to main competitor Boku. It’s only because they took action on the non-profit making routes that revenue decreased. Personally I think decks have been cleared now, it’s all upwards from here.

The FTSE 100 has done well but the AIM market has basically gone nowhere (albeit with lots of volatility) over the last three years. Remember it lost some of its tax advantages a while ago which led to significant funds being withdrawn. The company itself believes this is still hanging over the market. Additionally fund managers continue to see redemptions month after month which leads to them selling assets, which inevitably includes Bango. So I think there’s been downward pressure on the share price here for years. AIM is rubbish and the sooner Bango moves the better.

Dissatisfied investors can always consider averaging down. Now trading at 3x EBITDA. Is that down to the company or is it the market?

No great surprises today. I thought the management team was confident and optimistic about the future. Well on track during Q1. The only slight negatives I could see were a) the two DVM clients trailed in the January TU have not yet closed, and b) a very general comment that the macro environment (Iran etc) may have some effect on lengthening customer sales cycles. I like the segmentation of revenue and EBITDA - and 40%+ EBITDA margin for Payments is impressive. Given that the Subs EBITDA is barely positive they must be spending significant sums on that side of the business - but when it really cranks up the returns here will be huge.

Edison Research today reaffirm their SOTP valuation of 63-76p ps, with a DIS valuation of c£150m (61p per share - higher than current EV of £147m). They conclude that the market is valuing Search and Comparison at zero, more or less, despite generating a forecast £20m EBITDA this year.

Bought more. Seems that this is a very good price to buy IF the DIS deal is done. “Materially more” than £120m (say $160m) must be close to $200m, which would repay all net debt (say $90m) and leave $110m of cash, which is $0.44 or 33p. Rest of business would come free. So a binary bet based on whether the deal goes through.

Strange drop at the open. Both Panmure Capital and Shore have reiterated their forecasts and retain a strong belief in the company, with the share price less than half what their historical valuation suggests is warranted.

Greater clarity is always welcome, but Trump’s tariffs were almost 12m ago now and the order book in H2 2025 was up 25% on H1, with the latest update from January stating “The opening order book, the prospect pipeline, and the actions taken in 2025 position the Group well to deliver on market expectations for the current financial year and beyond.”

With the DOCOMO integration - perhaps not as smooth as we’d like - in the rear view mirror it’s all about DVM. And the growth in subs and ARR surely point to good growth - not a proposition worth nothing.

Choose your metric to show what a joke this is:

Forward PE 18x

Forward EV/EVITDA <4x

Price/ Forward FCF 12x

SaaS “rule of 40” - exceeded (>50)

Forward FCF yield 7%

Cash generating, no need for equity raises

MPAC looking good value here at a two year low. A forward PE of less than 7x and EV/EBITDA of around 5x, even in its current circumstances, and with the possibility of industry consolidation always hanging around.

At the current share price Bango is valued at c5x EBITDA for FY25 transactional business (assuming guided 40% margin) - that’s significantly less than Boku for their DCB - with absolutely zero value placed on the DVM. Make of that what you will.

Time for the annual Boku comparison after their results today, even though I think they’re mostly not comparable nowadays - though 55% of Boku’s revenue does come from DCB and they are now also going after “bundling” opportunities (not quite the sane as Bango I think).

At their current share price (down 28% YTD) they’re valued at 8.0x forward EBITDA (said to be at a slight premium to competitors) and 6.5 x 2027 EBITDA (said to be in-line). Their forward PE ratio is just under 20x. By comparison Bango is at less than 4x forward EBITDA and is also around 20x forward PE. So if you think these two companies are comparable I’d suggest Bango is at least 50% undervalued or an EV/EBITDA basis. And while that would push up this year’s PE ratio we know earnings are severely impacted by the amortisation figure, and earnings should grow rapidly in 2027. Overall, then, I think Bango looks significantly undervalued (if not quite as much as suggested by analysts with a 200p price target).

Zeus’ guidance for 2026 is very low growth - revenue $491.4 vs $481.9, with a small further drop in Search offsetting modest growth in DIS and 20% growth in comparison. Adj EBITDA $45.8 vs $42.7. They see a little stronger growth in 2027 but not massive.

Using the same SOTP methodology their current 91p per share valuation would grow to 101p by year end and 118p end-2027.

I’m slightly dubious as to the potential sale prize for DIS. “Exceeding market cap” could be as little as $140m compared to the $250m included in Zeus SOTP estimate (=12xEBITDA). Even with a much lower sale price this still looks cheap, however. Given that, I’m back in with a modest sum here even though I’m not excited about the company long term. I see much more exciting things happening in the US with various AI-fuelled ad-tech/martech companies.

I find it hard to believe BGO could go any lower than it is today - it’s already at just 4x forward EBITDA and c20x forward PE, in its first full year of positive free cash flow and net income.

SaaS companies such as BGO have been massacred in the US since the start of the year, down 30-40% on fears (panic) that AI could easily replicate what they do and reduce their ability to price services at the same level. Those fears seem to be receding as common sense takes over and AI is seen as more likely to improve efficiency than replace software companies - especially those who have lots of data borne from experience that can’t just be accessed by new AI tools. In Bango’s case, can telcos, retailers etc create their own bundling services more easily such that the value of the DVM is reduced? This is my most important question for BGO - to what extent do they consider AI a threat to their business. If no threat at all, or even a tailwind, then I think it’s severely underpriced.

I believe there is also some seasonality to the DVM business (albeit not the initial installations), given the telcos etc will run campaigns at times of the year when their customers are more likely to spend money (eg Continente’s rapid installation in time for last Christmas). But yes, perhaps a bit less than when it was only DCB.

I’m a little dumbfounded by the apparent lack of interest from investors at the moment. You only have to project recent rates of revenue growth, margins and opex to see how valuation ratios (PE, P/FCF, EV/EBITDA, whatever) all become very attractive in the relatively near future.

Good post Persiflage. I’d just note that this is a seasonal business where H2 is always greater than H1, so I’m not sure how much one can infer from the higher H2 figures. In 2024, for example, we saw a similar picture - EBITDA margin was 40.3% in H2 but only 14.3% in H1, and in 2023 the respective figures were 22.8% and -1.0%. Definitely moving in the right direction overall, though - the annual EBITDA margins from 2023-26 (the 2026 forecast being from Cannacord) are 13.9%, 28.6%, 31.2% and 35.7%.

A couple of extra things I’ve noticed in the TU today. First, the DVM licence fee revenue (as opposed to one-off installation fees) has gone up by almost 30% (as has ARR - not quite the same thing), fuelled by 60% growth in active subscriptions. This is excellent growth.

And second, if transactional business has an EBITDA margin of 40%, DVM’s is only 10%. However Cannacord’s 2026 estimates imply the latter will increase to closer to 30%. Together with the very high level of capex ($14.2m in 2025), which presumably will moderate in future years, this suggests there’s loads of room for margin expansion as the business grows and matures. In summary, give it a couple of years and the financials will be very attractive, imo.