Bolsa Izertis

GVC Gaesco gives a 35% revaluation potential to Izertis share

The independent financial group GVC Gaesco has presented the first report on the initiation of coverage of the company specialized in ICT services and digital transformation Izertis, with a Buy recommendation and a target price of 9.70 euros per share. This represents a potential revaluation of 35% compared to the market closing price this Monday.

The publication of the report coincides with the second year of trading of our consultancy since it was incorporated as listed on BME Growth (former MAB) in November 2019. Since then, the technology consultancy has multiplied its market capitalization value by 4.3. In this way, it made its debut on the market with a starting price of 1.7 euros per share, which represented a value of 36.2 million euros. 24 months later, the capitalization already exceeds 165 million euros.

This report mentions that Izertis has achieved a “relevant position in the Spanish market in recent years, accessing increasingly large accounts. The company has written a history of sustained growth that in recent years is accelerating to consolidate the market. It operates in a sector of great growth, supported by macro trends such as digitization and the technological transformation of companies”.

Along these lines, GVC Gaesco emphasizes that in a sector which is still very fragmented, Izertis has a “successful track record of integration” of small companies that add value to technology. This trend will continue in the future, which will help further boost Izertis' own organic growth, and will reinforce the group's results in the coming years.

Regarding the 2020-2023 Strategic Plan of the technology company, GVC Gaesco points out that Izertis will reach the goal of a turnover of 125 million euros in 2023, combining organic and inorganic growth. While in terms of normalized Ebitda margin, it estimates that "it will exceed the forecast of 10%, standing at 11.1%", according to the document.

It also states that the consulting firm “has the capacity and means to achieve the objectives of its 2020-2023 Strategic Plan, and has a healthy financial situation to undertake its inorganic growth. Thus, GVC Gaesco analysts estimate that the Net Financial Debt / Ebitda ratio will not exceed 2.3 times in the coming years”.

Two years as listed

In its first session at BME Growth, on November 25, 2019, the firm closed a 47.06% increase in the revaluation of its shares, which meant the best debut of the year for a company in this market. Along these lines, after only 7 months since entering the segment, it was incorporated into the IBEX Growth Market 15, where the companies with the highest volume of contracts are included. Thus, its capitalization has gone from 36.2 million euros on its first day, to the 165 million it currently holds.

Its 2020-2023 Strategic Plan is designed to reach 125 million euros in turnover and a normalized Ebitda of 12.5 million in this period. This would be supported by an Annual Constant Growth Rate of both magnitudes higher than 25% in the last 10 years.

Supported by a growth rate higher than 25% in the last 10 years

In the audited results presented in 2020, Izertis has managed to reach a business figure of 50.7 million euros, with a normalized Ebitda of 5.3 million. As for the end of the first half of 2021, these same figures increased by 24.0% and 61.6%, compared to the same previous period.

Izertis has offices throughout Europe, America and Africa, as well as projects in more than 50 countries. Currently, its work teams are made up of more than 1,100 professionals who work for clients from multiple sectors and disciplines, among which the main IBEX 35 companies and large public administrations both in Spain and internationally stand out.

“Being listed on BME Growth not only allows us to access new financing tools to boost our growth, but also helps us develop the company's brand positioning, attract external talent and consolidate internal talent. During these 2 years we have met the objectives that we have proposed in our 2020-2023 strategic plan, which has been reflected in the confidence of investors, who positively value both our path and our medium and long-term objectives", as Pablo Martín, founder, president and CEO of Izertis, has stated.