Scout24 announced in a press release the acquisition of consumer finance platform FINANZCHECK.de for €285m in cash, with the deal funded through a credit facility. Based on 2017 revenues of €35m, this would imply TTM EV/Sales of 8.1x. Scout sees this acquisition as highly complementary to its Consumer Services division by enhancing Scout’s role in the consumer journey.
The initial focus will be on AS24 to offer financing options to both car buyers as well as dealers, with plans to further roll this out to the core European countries as well as integrate the platform in real estate. Scout notes that FINANZCHECK.de is a top 3 portal in Germany in terms of market share for online comparison of consumer loans and has a strong track record with 30% revenue CAGR over the last three years. The deal is expected to close within four to six weeks subject to anti-trust approval. We see this acquisition as in line with Scout’s strategy of expanding its presence in adjacencies, as discussed at the Investor Day in 2017. This also follows the acquisition last year of autos marketplace Gebrauchtwagen in Austria.
We are Neutral rated on Scout24 with a 12-month, SOTP-based price target of €44.1. Key risks to our view and price target: Better/weaker than expected trends in the real estate and autos end markets, execution risks, value-destructive/accretive M&A.
|G24n.DE||12m Price Target: €44.10||Price: €47.66||Downside: 7.5%|
|Market cap: €5.1bn / $6.0bn|
|Enterprise value: €5.6bn / $6.6bn|
|3m ADTV: €10.4mn / $12.2mn|
|Net debt/EBITDA (X): 1.6|
|M&A Rank: 3|
|Revenue (€ mn)||479.8||532.4||586.5||642.8|
|EBIT (€ mn)||234.2||274.3||312.2||353.1|
|Dividend yield (%)||1.7||1.2||1.6||2.0|
|FCF yield (%)||4.1||3.6||4.3||4.8|
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