A 110 Year-Old Business for 3x FCF

I found a way to access Bloomberg’s no.1 competitor for 90% less. Here’s how →

Today’s business has operated for 110 years.

It generates more than ¥50bn of annual revenue.

It has approximately one year of revenue already secured through signed contracts.

The balance sheet contains ¥7.84bn of cash equivalents and another ¥1.59bn of investment securities.

The entire thing can currently be purchased for approximately ¥11.66bn, in market cap terms.

After adjusting for cash, investments, debt and leases, the enterprise value is approximately ¥4.02bn.

This all gives us the following valuation ratios:

NCAV Ratio = 1.2

TBV Ratio = 0.6

EV/FCF Ratio = 3.1

P/FCF Ratio = 8.9

The operating business has generated an average owner-FCF of roughly ¥1.31bn over the last five years.

That operating business is also pretty durable and consistently cash-generative.

In other words, I would happily buy this business in the real world.

Let’s take a look….