$AMRS
Part 1
Another juicy comp in the luxury (not quite clean per Sephora) skincare category:
“Unilever has signed a deal to acquire skin care brand Paula’s Choice for around $2 billion, according to industry sources. Terms of the deal were not disclosed, and Unilever declined to comment on the price tag. WWD had previously reported in April that the brand was exploring M&A options, and that the business is expected to do more than $300 million in net sales for 2021.”
Source - yahoo.com/lifestyle/unileve...
Also:
“Paula’s Choice has grown significantly since private equity firm TA Associates invested in 2016, when the brand had an estimated $70 million in net sales. For 2020, industry sources said Paula’s Choice did about $220 million in net sales, and that the company expects to do more than $300 million in net sales for 2021. One source said the company’s earnings before interest, taxes, depreciation and amortization are more than $110 million.”
Source - yahoo.com/lifestyle/paula-c...
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Part 2
Back of the napkin revenue growth for Paula's Choice attached.
So we're looking at a 9.1x LTM revenue multiple and a 6.7x NTM revenue multiple. While consumer is growing much much faster than Paula's Choice, PC is well ahead in EBITDA so let's say those two factors are a wash and that consumer would fetch a similar multiple on the open market.
“Our consumer business this year will deliver somewhere between $130 and $150 million dollars of revenue, and then our ingredients business this year will deliver somewhere around 90 to $100 million of revenue”
Source - stocktwits.com/GreenAndGree...
We could sell consumer now for $871M to $1B or in a year from now for the same $2B that Paula's Choice received presuming that we do $300M in consumer revenue in 2022.
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Part 3
Where does the $300M consumer estimate come from?
“Our consumer business is performing better than expected this year. And we expect this business to be around $300 million in 2022 revenue while continuing to more than double annually for the next several years.”
Source - seekingalpha.com/article/44...
Sum-of-the-parts then at this very moment:
Platform = $4.5B (in line with ZY's market cap and them having $0 revenue)
Ingredients =$1.5B (15x on forward revenue)
Consumer = $1.0B
Total fair value = $7.0B or $23.33 per share @ 300M shares
