RE: Re: Algn Research Top picks for 202023 Jan 2020 10:59
Big Dosh
With early stage technology companies it is difficult to accurately place a valuation on the shares given uncertainty surrounding future cashflows. However, there are plenty of transactions in the wider food technology industry which reflect the kind of valuation Big Dish could command should it successfully execute its strategy.
To take one example, yield management and restaurant reservation platform Eatigo completed a Series B fundraise in October 2016 at which point it reportedly had grown to 700 partner restaurants, with media sources suggesting that c.$10 million was invested by travel and restaurant website owner TripAdvisor. Siddhanta Kothari, Chief Financial Officer of Eatigo, suggested the business had a valuation of $70 million following the funding round, which we believe could be applied as a potential benchmark to BigDish as 700 restaurants look like an achievable goal in 2020, in our view. At current exchange rates that equates to a valuation of £54 million, some 13 times the current market cap. This valuation disparity with some of its private peers also poses the scenario where the company could be used as a merger/reverse vehicle – something the market clearly has not ascribed any probability to at this price.
Big Dish has been very active on the newsflow front since its IPO in August 2018, with the market often reacting positively to good news. With a new CEO in place and focussed expansion strategy, we believe that 2020 could see the shares rise markedly from their currently lows if further positive updates are made. Full update note to come from us in late January but at just 1.2p the shares look oversold and ripe for a material rebound pending newsflow in Q1 2020.
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