Shareholders in SPAC Dutch Star One have seen their share price more than quadruple within 4 years and now decrease by more than 50% whilst being CM.com
Geschiedenis: "Tijdens deze opleiding kwamen ze op het idee om een systeem voor betaalde groepsSMS-berichten te maken en te gaan verkopen. Als naam voor hun bedrijf bedachten ze de afkorting CM dat staat voor Club Message, een systeem dat men opzette voor hun eerste klant discotheek Highstreet in het Belgische Hoogstraten. In combinatie met de opkomst van de mobiele telefonie bleek het concept een schot in de roos. Binnen twee jaar had het bedrijf bijna duizend discotheken als klant."
CM.com had sales of EUR 237m in 2021 growing strongly from EUR 96m in 2019 and EUR 141m in 2020. The market cap is 28m shares x 20 EUR per share = EUR 560.
CM.com Graham Defensive Analysis:
SECTOR: [PASS] [FAIL] CM.com is a technology not a financial Company, and therefore this methodology might be applicable.
SALES: [PASS] The investor must select companies of "adequate size". This includes companies with annual sales greater than €260 million. CM.com's sales of €237 million, based on 2021 sales, and possible growth in 2022 just passes this test?
CURRENT RATIO: [PASS] The current ratio must be greater than or equal to 2. Companies that meet this criterion are typically financially secure and defensive. CM.com's current ratio €172m/€78m of 2.2 passes the test.
LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [FAIL] [PASS] For industrial companies, long-term debt must not exceed net current assets (current assets minus current liabilities). Companies that meet this criterion display one of the attributes of a financially secure organization. The long-term debt for CM.com is €102 million, while the net current assets are €94 million. CM.com just fails this test.
LONG-TERM EPS GROWTH: [FAIL] Companies must increase their EPS by at least 30% over a ten-year period and EPS must not have been negative for any year within the last 5 years. Companies with this type of growth tend to be financially secure and have proven themselves over time. CM.com is currently booking losses.
EARNINGS YIELD: [[FAIL] The Earnings/Price (inverse P/E) %, based on the lesser of the current Earnings Yield or the Yield using average earnings over the last 3 fiscal years, must be "acceptable", which this methodology states is greater than 6,5%. Stocks with higher earnings yields are more defensive by nature. CM.com's E/P is less than 0% (using last year's loss) and fails this test.
GRAHAM NUMBER VALUE: [FAIL] The Price/Book ratio must also be reasonable. That is the Graham number value must be greater than the market price. Aalberts has a Graham number of √(15 x €0,01 EPS x 1,5 x €3,4 Book Value) = €1
Dividend: CM.com does not pay a dividend.
Conclusion: Not a stock for a defensive investor. Could be a good investment? => Too difficult pile.
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