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European Technology Update 15 th February 2013 Member FINRA/SIPC Thierry Monjauze Managing Director 63 Brook
European Technology Update
15
th February 2013
Member FINRA/SIPC
Thierry Monjauze
Managing Director
63
Brook Street
London W1K 4HS
United Kingdom
Phone: +44 20 7518 8900
tmonjauze@harriswilliams.com
Francois Morin
Director
63
Brook Street
London W1K 4HS
United Kingdom
Phone: +44 20 7518 8900
fmorin@harriswilliams.com
www.harriswilliams.com
This report has been prepared by Harris Williams & Co. Ltd a registered broker-dealer and member of FINRA and SIPC, and Harris Williams & Co. Ltd, which is authorised and
regulated by the Financial Services Authority (FRN #540892). Harris Williams & Co. is a trade name under which Harris Williams LLC and Harris Williams & Co. Ltd conduct business.
Recent Developments Company  Dell , the provider of integrated technology solutions, is being taken
Recent Developments
Recent Developments

Recent Developments

Company

Dell, the provider of integrated technology solutions, is being taken private by Michael Dell and Silver Lake Management in a deal worth $24.4 billion

 

Specific

News

Virgin Media, the provider of internet, telephone and television services, has been acquired by Liberty Global for $13.1 billion

Warner Music Group has acquired Parlophone Records, the music record label, for £490 million

Ingenico has acquired Ogone, the provider of online payment solutions, from Summit Partners for 360 million

IXXAT Automation, the provider of hardware, software and support services for data communication, has been acquired by HMS Networks for 32 million

Koch Media has acquired Volition, the video game developer, from THQ for $22 million

 

Global Eagle Entertainment has acquired the remaining stake of Advanced Inflight Alliance, the provider of inflight entertainment solutions

Canal+ Events, the organiser of sports events in France, has been acquired by management from Canal Plus

Cisco Systems has acquired Cognitive Security, the network security solutions provider to SMEs

Dailymotion, the members web video portal, has been acquired by France Télécom

Eat It Now Group, the online takeaway ordering service provider, has been acquired by hungryhouse.com

Fiberdyne Labs, the manufacturer of fibre optic network and photonic products, has been acquired by Carbures Europe

Delivery Hero has acquired the remaining stake in hungryhouse.com, the online food delivery platform

 

Hexagon has acquired LISTECH, the provider of land surveying and civil engineering software solutions

Locomotion, the provider of postproduction services to advertising, film and broadcasting industries, has been acquired by Loveurope Group

OPUS Solutions, the developer of Microsoft Dynamics AX business software, has been acquired by terna

Salmon, the provider of e-commerce solutions and systems integration, has been acquired by WPP

Computas has acquired SC Ascenta IT Services, the provider of IT consulting services for business processes and integration solutions

Softel Group, the provider of TV and video technologies to broadcasters, network operators and producers, has been acquired by Miranda Technologies

Elisa has acquired Sulake Corporation, the provider of online entertainment services, virtual worlds and social networking solutions

The Net Crowd, provider of white labelled support solutions, was acquired by Daisy Group

 

Tuscany Design Automation, the designer of structured placement and visualisation solutions for integrated circuit design, was acquired by Dassault Systemes

Industry

Facebook and Google were the most active acquirers in the tech sector during 2012, as both firms continue their strategy of buying up smaller startups to help expansion beyond their core businesses, according to PrivCo

Trends

Using a smartphone to pay for purchases in lieu of a physical debit or credit card may become a $1 trillion business by 2015, according to Yankee Group

 

B2C e-commerce sales grew 21.1% to top $1 trillion for the first time, with sales set to grow by 18.3% to $1.3 trillion this year as Asia-Pacific overtakes North America to become the world’s number one market for B2C e- commerce sales, according to eMarketer

The UK has become one of the strongest digital commerce markets worldwide, as B2C e-commerce sales in the UK grew 14.4% to £77 billion in 2012 and are expected to grow 13.4% to £88 billion, and account for nearly one-third of all B2C ecommerce sales in Western Europe, according to eMarketer

In 2013, online retailers will be focusing on site optimisation to improve user experience, checkout optimisation and supporting alternative payments in an effort to increase web conversion and customer loyalty across all devices, according to eMarketer

 

1n 2013, B2B marketers will be focusing on digital investment with spending in email marketing a top priority over social or search marketing, according to BtoB Magazine

Consumer healthcare is increasingly moving online with more than a third of consumers managing their prescriptions online, according to Empathica

 
 

1

Source: Various industry news outlets.

Source: Various industry news outlets.

 
Public Market Trading Statistics Stock Last 30 Days Performance 16% 14% 12% 13.5% 10% 7.2%
Public Market Trading Statistics
Stock
Last 30 Days
Performance
16%
14%
12%
13.5%
10%
7.2%
6.2%
8%
6.2%
6%
3.5%
4%
2%
0%
08 Jan
13 Jan
18 Jan
23 Jan
28 Jan
02 Feb
07 Feb
Nasdaq Composite
Internet and Digital Media
Software and IT Services
Communications
DJ Stoxx 600 Technology
Last Twelve Months
30%
25%
20%
15%
10%
5%
17.8% 23.2%
10.5% 16.5% 9.0%
0%
(5%)
(10%)
(15%)
(20%)
Feb 2012
May 2012
Aug 2012
Nov 2012
Feb 2013
Nasdaq Composite
Internet and Digital Media
Software and IT Services
Communications
DJ Stoxx 600 Technology
Sources: Capital IQ, 8 February 2013; Brokers’ reports.
Comparable
CY2012E
EV / Revenue
EV / EBITDA
P / E
Trading
EBITDA Margin
Growth
CY2013E
CY2014E
CY2013E
CY2014E
CY2013E
CY2014E
Summary
Software and IT Services
14.8%
10.0%
Enterprise Applications
2.1x
1.9x
11.2x
9.0x
14.0x
11.9x
32.9%
5.5%
European Large Cap Software
3.7x
3.4x
11.2x
10.1x
17.7x
15.8x
24.7%
4.3%
Financial Software
2.3x
2.2x
9.4x
8.8x
16.6x
15.1x
22.2%
6.3%
Healthcare Software
2.3x
2.1x
9.4x
8.6x
16.6x
14.7x
13.6%
13.3%
Large Cap IT Services
1.0x
0.9x
6.9x
6.5x
13.7x
12.3x
8.5%
10.1%
Mid Cap IT Services
2.4x
1.9x
5.8x
5.4x
9.3x
8.2x
22.9%
15.7%
Offshore IT Services
2.4x
2.1x
10.1x
9.2x
15.1x
13.4x
34.8%
4.9%
Security Software
2.9x
2.7x
7.6x
6.9x
14.5x
13.0x
Communications
Digital Broadband
12.4%
(1.2%)
0.6x
0.6x
5.4x
4.4x
9.9x
9.1x
Diversified Communication Equipment
8.9%
3.0%
0.9x
0.8x
9.3x
7.1x
28.6x
20.3x
Mobile Content / Solutions Providers
20.2%
19.5%
1.6x
1.4x
8.0x
6.7x
19.3x
16.9x
Mobile Infrastructure Software
20.1%
19.5%
2.5x
2.4x
11.5x
10.8x
20.2x
18.6x
Internet and Digital Media
22.0%
240.9%
Chinese Internet Leaders
3.2x
2.7x
12.3x
10.6x
16.0x
18.2x
Online Classifieds
39.8%
18.4%
5.6x
4.9x
11.3x
12.1x
17.6x
15.3x
Content Providers / Communities
20.7%
18.6%
3.0x
2.6x
13.0x
16.7x
19.0x
15.0x
Ecommerce
20.5%
18.0%
2.9x
2.4x
14.2x
10.7x
27.6x
22.7x
Global Internet Leaders
37.0%
21.3%
4.4x
3.7x
12.6x
10.3x
20.6x
17.0x
Interactive Entertainment
19.9%
7.1%
1.3x
1.2x
11.8x
10.1x
13.6x
12.6x
20.7%
22.8%
Intermediation and Comparison
3.2x
2.6x
13.1x
13.7x
21.0x
18.8x
Online Gambling
27.5%
4.2%
2.4x
2.3x
8.4x
8.0x
14.9x
13.8x
Online Marketing
15.8%
9.2%
1.5x
1.3x
8.2x
6.8x
15.5x
14.1x
Online Travel
28.2%
13.4%
3.3x
2.9x
10.8x
9.3x
18.0x
15.3x
2
Software and IT Services Last 30 Days Performance 11.7% 10.7% 15% Healthcare Software Large Cap
Software and IT Services
Last 30 Days Performance
11.7%
10.7%
15%
Healthcare Software
Large Cap IT Services
Offshore IT Services
Mid Cap IT Services
Financial Software
Enterprise Applications
Security Software
European Large Cap Software
10.1%
8.8%
5.1%
4.9%
4.9%
2.9%
10%
5%
0%
(5%)
08 Jan
13 Jan
18 Jan
23 Jan
28 Jan
02 Feb
07 Feb
European Large Cap Software
Financial Software
Enterprise Applications
Healthcare Software
Security Software
Large Cap IT Services
Mid Cap IT Services
Offshore IT Services
Last Twelve Months Performance
Large Cap IT Services
31.6%
European Large Cap Software
Healthcare Software
25.0%
20.7%
Mid Cap IT
Services
18.3%
50%
Financial Software
18.2%
Offshore
IT Services
5.7%
Enterprise Applications
5.6%
40%
Security Software
(1.9% )
30%
20%
10%
0%
(10%)
(20%)
(30%)
Feb 2012
May 2012
Aug 2012
Nov 2012
Feb 2013
European Large Cap Software
Financial Software
Enterprise Applications
Healthcare Software
Security Software
Large Cap IT Services
Mid Cap IT Services
Offshore IT Services
Source: Capital IQ, 8 February 2013.
3
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued)

Software and IT Services (Continued)

Market

Cap ($m)

Enterprise

Value ($m)

CY2013E EV / Revenue EV / EBITDA P / E EBITDA Margin Growth CY2013E CY2014E
CY2013E
EV / Revenue
EV / EBITDA
P / E
EBITDA Margin
Growth
CY2013E
CY2014E
CY2013E
CY2014E
CY2013E
CY2014E

European Large Cap Software

SAP

95,442

98,955

34.9%

12.9%

4.1x

3.7x

11.7x

10.4x

17.2x

15.2x

Dassault Systemes

13,430

11,768

33.7%

8.7%

4.0x

3.7x

12.0x

10.6x

22.0x

19.8x

Sage

6,289

6,517

29.2%

0.5%

2.9x

2.8x

10.1x

9.6x

14.8x

13.6x

Software AG

3,399

3,332

27.7%

1.9%

2.3x

2.2x

8.5x

7.7x

14.1x

12.5x

Aveva

2,293

2,032

33.4%

8.0%

5.4x

4.8x

16.0x

13.9x

25.6x

22.3x

Micro Focus

1,499

1,470

43.4%

1.1%

3.4x

3.3x

7.9x

7.8x

11.3x

10.6x

Temenos

1,417

1,598

28.4%

5.0%

3.4x

3.2x

12.0x

10.9x

18.9x

16.5x

Mean

32.9%

5.5%

3.7x

3.4x

11.2x

10.1x

17.7x

15.8x

Median

33.4%

5.0%

3.4x

3.3x

11.7x

10.4x

17.2x

15.2x

Financial Software

Intuit

18,210

18,151

38.2%

15.6%

3.7x

3.4x

9.8x

8.9x

17.5x

15.7x

Temenos

1,417

1,598

28.4%

5.0%

3.4x

3.2x

12.0x

10.9x

18.9x

16.5x

SimCorp

1,037

981

26.6%

14.4%

3.1x

2.8x

11.7x

10.4x

17.6x

15.3x

Fidessa

913

834

21.9%

(2.3%)

1.9x

1.8x

8.6x

8.7x

19.5x

18.5x

Innovation

381

344

14.1%

3.5%

1.0x

1.0x

7.4x

6.7x

16.0x

14.0x

Microgen

155

112

30.3%

(3.5%)

2.2x

2.1x

8.7x

7.9x

14.1x

13.6x

Linedata

153

210

22.4%

3.7%

1.1x

1.0x

4.7x

4.6x

8.8x

8.1x

StatPro

91

97

15.8%

(2.2%)

1.9x

1.9x

12.3x

12.0x

20.6x

19.3x

Mean

24.7%

4.3%

2.3x

2.2x

9.4x

8.8x

16.6x

15.1x

Median

24.5%

3.6%

2.1x

2.0x

9.2x

8.8x

17.5x

15.5x

Enterprise Applications

Guidewire Software

1,775

1,590

11.6%

23.9%

5.1x

4.2x

43.9x

31.1x

NM

NM

Unit 4

991

1,153

20.4%

7.7%

1.7x

1.6x

8.4x

7.5x

22.1x

17.1x

Jive Software

929

795

(18.4%)

35.2%

5.2x

4.0x

NM

NM

NM

NM

SDL

678

687

16.4%

1.2%

1.5x

1.5x

9.4x

8.2x

14.5x

13.3x

Exact

492

425

23.4%

3.0%

1.4x

1.4x

6.1x

6.0x

11.5x

10.8x

IFS

452

430

14.6%

4.8%

1.0x

1.0x

6.8x

5.8x

18.6x

12.6x

Kofax

358

274

18.5%

1.3%

1.0x

0.9x

5.3x

5.0x

11.8x

10.9x

F-Secure

354

310

22.6%

8.1%

1.4x

1.3x

6.1x

5.3x

12.3x

10.8x

Cegid

182

281

23.9%

4.4%

0.8x

0.7x

3.2x

3.1x

6.9x

8.0x

Mean

14.8%

10.0%

2.1x

1.9x

11.2x

9.0x

14.0x

11.9x

Median

18.5%

4.8%

1.4x

1.4x

6.5x

5.9x

12.3x

10.9x

Healthcare Software

McKesson

24,174

25,927

2.7%

2.6%

0.2x

0.2x

7.6x

6.9x

13.2x

12.1x

Cerner

15,172

14,331

32.1%

13.6%

4.8x

4.2x

14.8x

12.7x

31.5x

26.8x

Allscripts Healthcare Solutions

1,859

2,227

21.5%

3.7%

1.5x

1.4x

6.8x

6.2x

13.3x

11.9x

CompuGroup

1,143

1,476

24.7%

8.5%

2.3x

2.2x

9.2x

8.5x

13.2x

11.3x

Emis

626

603

34.7%

7.8%

4.0x

3.7x

11.5x

10.5x

19.9x

17.8x

Advanced Computer Software

465

463

22.8%

4.3%

2.5x

2.3x

10.9x

10.4x

18.1x

16.8x

Cegedim

402

1,047

17.2%

3.4%

0.8x

0.8x

4.9x

4.6x

6.9x

6.0x

Mean

22.2%

6.3%

2.3x

2.1x

9.4x

8.6x

16.6x

14.7x

Median

22.8%

4.3%

2.3x

2.2x

9.2x

8.5x

13.3x

12.1x

Sources: Capital IQ, 8 February 2013; Brokers’ reports.

4

4.3% 2.3x 2.2x 9.2x 8.5x 13.3x 12.1x Sources: Capital IQ, 8 February 2013; Brokers’ reports. 4
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Software and IT Services (Continued)

Software and IT Services

(Continued)

Market

Cap ($m)

Enterprise

Value ($m)

CY2013E EV / Revenue EV / EBITDA P / E EBITDA Margin Growth CY2013E CY2014E
CY2013E
EV / Revenue
EV / EBITDA
P / E
EBITDA Margin
Growth
CY2013E
CY2014E
CY2013E
CY2014E
CY2013E
CY2014E

Security Software

Symantec

15,569

14,393

33.0%

2.6%

2.1x

2.0x

6.3x

5.3x

12.4x

10.5x

Check Point

10,580

9,077

58.3%

5.6%

6.4x

6.0x

10.9x

10.2x

15.1x

13.8x

Trend Micro

3,808

2,608

31.2%

(4.5%)

2.5x

2.5x

8.1x

7.9x

23.3x

22.2x

AVG Technologies

711

778

29.0%

12.8%

1.9x

1.8x

6.6x

5.6x

9.2x

7.8x

F-Secure

354

310

22.6%

8.1%

1.4x

1.3x

6.1x

5.3x

12.3x

10.8x

Mean

34.8%

4.9%

2.9x

2.7x

7.6x

6.9x

14.5x

13.0x

Median

31.2%

5.6%

2.1x

2.0x

6.6x

5.6x

12.4x

10.8x

Large Cap IT Services

Accenture

47,236

42,042

16.5%

6.3%

1.4x

1.3x

8.5x

8.2x

16.7x

15.3x

CGI

8,436

11,410

14.7%

64.3%

1.1x

1.1x

7.6x

7.3x

12.5x

10.7x

Capita Group

8,269

10,673

16.4%

5.5%

1.9x

1.7x

11.4x

10.6x

14.4x

13.3x

Cap Gemini

7,340

7,449

9.7%

4.1%

0.5x

0.5x

5.5x

5.1x

12.6x

11.4x

Computer Sciences

7,014

7,460

13.0%

(4.1%)

0.5x

0.5x

3.8x

3.6x

13.4x

11.6x

Atos Origin

6,403

6,305

11.0%

4.0%

0.5x

0.5x

4.7x

4.4x

12.6x

11.6x

Mean

13.6%

13.3%

1.0x

0.9x

6.9x

6.5x

13.7x

12.3x

Median

13.8%

4.8%

0.8x

0.8x

6.5x

6.2x

13.0x

11.6x

Mid Cap IT Services

Splunk

3,296

3,022

2.4%

34.6%

11.6x

8.7x

NM

NM

NM

NM

Indra Sistemas

1,958

2,873

10.2%

4.4%

0.7x

0.7x

7.0x

6.4x

9.3x

8.1x

Tieto

1,661

1,707

12.9%

(1.8%)

0.7x

0.7x

5.6x

5.2x

13.0x

11.3x

Sopra

917

1,294

10.0%

6.3%

0.8x

0.7x

7.7x

7.2x

9.7x

8.9x

Groupe Steria

553

852

8.4%

2.7%

0.3x

0.3x

4.1x

3.8x

6.3x

5.5x

GFI Informatique

232

317

6.8%

14.5%

0.3x

0.3x

4.7x

4.4x

8.2x

7.4x

Mean

8.5%

10.1%

2.4x

1.9x

5.8x

5.4x

9.3x

8.2x

Median

9.2%

5.3%

0.7x

0.7x

5.6x

5.2x

9.3x

8.1x

Offshore IT Services

Tata

51,400

50,236

28.3%

20.5%

3.8x

3.4x

13.6x

12.1x

18.1x

15.8x

Infosys

29,606

25,450

28.6%

15.6%

3.1x

2.8x

10.9x

9.8x

15.9x

14.2x

Cognizant

23,634

20,770

20.4%

17.3%

2.4x

2.1x

11.8x

10.1x

19.6x

16.7x

Wipro

18,601

16,699

19.8%

11.3%

2.0x

1.8x

9.9x

9.3x

14.3x

12.8x

HCL

8,506

8,205

20.7%

15.5%

1.7x

1.5x

8.0x

7.4x

12.4x

11.2x

Satyam

2,606

2,046

19.9%

14.1%

1.3x

1.2x

6.6x

6.2x

10.5x

9.7x

Mean

22.9%

15.7%

2.4x

2.1x

10.1x

9.2x

15.1x

13.4x

Median

20.5%

15.5%

2.2x

1.9x

10.4x

9.5x

15.1x

13.5x

Sources: Capital IQ, 8 February 2013; Brokers’ reports.

5

2.2x 1.9x 10.4x 9.5x 15.1x 13.5x Sources: Capital IQ, 8 February 2013; Brokers’ reports. 5
Communications Last 30 Days Performance 18% Digital Mobile Infrastructure Broadband Software DiversifiedCommunication
Communications
Last 30 Days Performance
18%
Digital Mobile Infrastructure Broadband Software
DiversifiedCommunication Mobile Content / Solutions Providers Equipment
16.7%
12.7% 14.6% 6.7%
16%
14%
12%
10%
8%
6%
4%
2%
0%
(2%)
08 Jan
13 Jan
18 Jan
23 Jan
28 Jan
02 Feb
07 Feb
Digital Broadband
Diversified Communication Equipment
Mobile Infrastructure Software
Mobile Content / Solutions Providers
Last Twelve Months Performance
13.4% 39.2%
60%
Mobile Digital Infrastructure Broadband Software
DiversifiedCommunication Mobile Content / Solutions Providers Equipment
(12.4%) 0.0%
50%
40%
30%
20%
10%
0%
(10%)
(20%)
(30%)
(40%)
(50%)
Feb 2012
May 2012
Aug 2012
Nov 2012
Feb 2013
Digital Broadband
Diversified Communication Equipment
Mobile Infrastructure Software
Mobile Content / Solutions Providers
Source: Capital IQ, 8 February 2013.
6
Communications (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue EV / EBITDA
Communications (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue EV / EBITDA
Communications (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue EV / EBITDA
Communications (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue EV / EBITDA
Communications (Continued)

Communications

(Continued)

Market

Cap ($m)

Enterprise

Value ($m)

CY2013E EV / Revenue EV / EBITDA P / E EBITDA Margin Growth CY2013E CY2014E
CY2013E
EV / Revenue
EV / EBITDA
P / E
EBITDA Margin
Growth
CY2013E
CY2014E
CY2013E
CY2014E
CY2013E
CY2014E

Digital Broadband

TomTom

1,121

1,329

16.0%

(3.5%)

1.0x

1.0x

6.2x

5.9x

11.2x

10.1x

Technicolor

1,119

2,494

15.6%

(2.9%)

0.5x

0.6x

3.4x

3.4x

6.8x

5.0x

Pace

1,081

1,324

9.5%

(4.9%)

0.6x

0.6x

5.9x

5.7x

9.0x

8.2x

Logitech

1,074

752

3.9%

(10.6%)

0.4x

0.4x

9.6x

4.1x

NM

12.4x

Kudelski

608

864

14.6%

2.1%

0.9x

0.9x

6.1x

5.8x

12.2x

10.8x

Parrot

489

362

16.9%

9.7%

0.9x

0.8x

5.2x

4.8x

11.5x

10.2x

Advanced Digital Broadcast

82

64

10.2%

1.8%

0.1x

0.1x

1.5x

1.4x

8.7x

7.1x

Mean

12.4%

(1.2%)

0.6x

0.6x

5.4x

4.4x

9.9x

9.1x

Median

14.6%

(2.9%)

0.6x

0.6x

5.9x

4.8x

10.1x

10.1x

Diversified Communication Equipment

 

LM Ericsson Telephone

38,894

31,625

13.0%

6.6%

0.9x

0.8x

6.6x

5.7x

15.2x

12.7x

Nokia

15,303

10,691

6.0%

(0.8%)

0.3x

0.3x

4.5x

3.4x

NM

21.6x

Alcatel-Lucent

3,874

4,715

6.2%

0.2%

0.2x

0.2x

4.0x

3.0x

NM

25.3x

CIENA

1,630

2,380

7.0%

8.8%

1.2x

1.1x

16.7x

12.1x

43.7x

21.0x

ADTRAN

1,312

1,129

12.5%

0.1%

1.8x

1.7x

14.5x

11.2x

27.0x

20.7x

Mean

8.9%

3.0%

0.9x

0.8x

9.3x

7.1x

28.6x

20.3x

Median

7.0%

0.2%

0.9x

0.8x

6.6x

5.7x

27.0x

21.0x

Mobile Infrastructure Software

QUALCOMM

115,029

101,805

38.9%

21.4%

4.1x

3.7x

10.6x

9.8x

15.0x

13.5x

VeriSign

6,962

6,104

63.0%

9.4%

6.4x

6.0x

10.2x

9.5x

20.0x

18.0x

Amdocs

5,832

4,871

20.7%

3.9%

1.4x

1.4x

6.9x

7.0x

12.3x

11.3x

Synchronoss Technologies

1,118

1,071

31.7%

25.6%

3.1x

2.6x

9.9x

8.0x

22.7x

18.2x

Sonus Networks

758

489

0.5%

5.6%

1.8x

1.4x

NM

NM

NM

NA

Redknee Solutions

211

200

8.1%

61.4%

2.1x

1.1x

25.8x

25.8x

42.4x

42.4x

TeleCommunication Systems

138

254

10.4%

(5.3%)

0.6x

0.5x

5.4x

5.0x

8.5x

8.0x

Smith Micro Software

58

31

(12.4%)

34.5%

0.5x

NM

NM

NM

NM

NA

Mean

20.1%

19.5%

2.5x

2.4x

11.5x

10.8x

20.2x

18.6x

Median

15.5%

15.4%

1.9x

1.4x

10.0x

8.7x

17.5x

15.8x

Mobile Content / Solutions Providers

Opera Software

764

700

30.0%

31.0%

2.5x

2.0x

8.3x

6.2x

15.6x

11.5x

GameLoft

550

492

17.6%

19.8%

1.5x

1.3x

8.5x

6.7x

16.1x

12.9x

Dada

67

103

13.1%

7.7%

0.9x

0.9x

7.2x

7.2x

26.2x

26.2x

Mean

20.2%

19.5%

1.6x

1.4x

8.0x

6.7x

19.3x

16.9x

Median

17.6%

19.8%

1.5x

1.3x

8.3x

6.7x

16.1x

12.9x

Sources: Capital IQ, 8 February 2013; Brokers’ reports.

7

1.5x 1.3x 8.3x 6.7x 16.1x 12.9x Sources: Capital IQ, 8 February 2013; Brokers’ reports. 7
Internet and Digital Media Last 30 Days Performance 20% 15% Online Gambling Ecommerce Interactive Entertainment
Internet and Digital Media
Last 30 Days Performance
20%
15%
Online Gambling
Ecommerce
Interactive Entertainment
Content Providers / Communities
Online Classifieds
Intermediation and Comparison
Chinese Internet Leaders
Online Marketing
Global Internet Leaders
Online Travel
17.7%
10.7%
9.6%
7.7%
6.4%
4.0%
2.7%
1.9%
1.2%
0.5%
10%
5%
0%
(5%)
08 Jan
13 Jan
18 Jan
23 Jan
28 Jan
02 Feb
07 Feb
Global Internet Leaders
Ecommerce
Online Travel
Online Marketing
Content Providers / Communities
Intermediation and Comparison
Online
Classifieds
Chinese Internet Leaders
Online
Gambling
Interactive Entertainment
Last Twelve Months Performance
Online Gambling
Online Classifieds
Ecommerce
Intermediation and Comparison
Online Travel
Global Internet Leaders
Chinese Internet Leaders
Content Providers / Communities
Online Marketing
Interactive Entertainment
53.3%
100%
27.1%
26.0%
90%
23.7%
17.6%
14.3%
80%
6.0%
(4.7% )
70%
(15.8% )
(21.6% )
60%
50%
40%
30%
20%
10%
0%
(10%)
(20%)
(30%)
(40%)
Feb 2012
May 2012
Aug 2012
Nov 2012
Feb 2013
Global Internet Leaders
Ecommerce
Online Travel
Online Marketing
Content Providers / Communities
Intermediation and Comparison
Online
Classifieds
Chinese Internet Leaders
Online
Gambling
Interactive Entertainment
Source: Capital IQ, 8 February 2013.
8
Internet and Digital Media (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Internet and Digital Media (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Internet and Digital Media (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Internet and Digital Media (Continued) Market Cap ($m) Enterprise Value ($m) CY2013E EV / Revenue
Internet and Digital Media (Continued)

Internet and Digital Media (Continued)

Market

Cap ($m)

Enterprise

Value ($m)

CY2013E EV / Revenue EV / EBITDA P / E EBITDA Margin Growth CY2013E CY2014E
CY2013E
EV / Revenue
EV / EBITDA
P / E
EBITDA Margin
Growth
CY2013E
CY2014E
CY2013E
CY2014E
CY2013E
CY2014E

Global Internet Leaders

Apple

446,034

406,214

33.2%

13.3%

2.2x

1.9x

6.5x

5.9x

10.3x

9.1x

Google

258,908

218,030

36.2%

16.6%

3.6x

3.1x

9.8x

8.5x

17.3x

14.8x

Microsoft

230,766

176,886

41.0%

16.6%

2.1x

2.0x

5.1x

4.6x

8.9x

8.3x

Amazon

119,070

112,007

6.4%

22.1%

1.5x

1.2x

23.1x

16.8x

NM

NM

eBay

73,409

68,520

33.2%

16.3%

4.2x

3.7x

12.6x

10.9x

20.5x

17.6x

Facebook

67,998

60,728

52.1%

32.4%

9.1x

7.2x

17.5x

13.3x

49.0x

36.9x

Baidu

33,868

30,758

49.0%

39.3%

6.3x

4.9x

12.8x

10.1x

18.0x

14.4x

Yahoo!

24,245

20,231

36.2%

3.1%

4.4x

4.3x

12.2x

11.6x

18.1x

16.9x

Yandex

8,087

7,705

45.5%

31.7%

6.3x

5.0x

13.8x

11.2x

22.7x

17.9x

Mean

37.0%

21.3%

4.4x

3.7x

12.6x

10.3x

20.6x

17.0x

Median

36.2%

16.6%

4.2x

3.7x

12.6x

10.9x

18.0x

15.8x

Ecommerce

Amazon

119,070

112,007

6.4%

22.1%

1.5x

1.2x

23.1x

16.8x

NM

NM

eBay

73,409

68,520

33.2%

16.3%

4.2x

3.7x

12.6x

10.9x

20.5x

17.6x

Facebook

67,998

60,728

52.1%

32.4%

9.1x

7.2x

17.5x

13.3x

49.0x

36.9x

Netflix

10,133

9,817

6.6%

18.7%

2.3x

2.0x

34.6x

21.1x

NM

NM

Mail.ru

7,478

6,457

50.4%

24.1%

7.7x

6.3x

15.2x

12.4x

24.5x

20.1x

Mercadolibre

3,697

3,523

36.7%

23.9%

7.6x

5.8x

20.6x

15.5x

30.1x

22.1x

IAC

3,686

3,621

18.9%

16.2%

1.1x

1.0x

5.9x

5.0x

11.9x

9.8x

Groupon

3,561

2,365

9.7%

16.9%

0.9x

0.8x

9.0x

7.0x

23.5x

18.5x

Shutterfly

1,523

1,278

18.7%

24.3%

1.7x

1.5x

9.2x

7.6x

24.9x

20.8x

OpenTable

1,204

1,101

43.4%

17.3%

5.8x

5.0x

13.4x

11.2x

27.9x

23.7x

Vistaprint

1,159

1,325

12.4%

13.4%

1.1x

1.0x

8.6x

7.3x

18.1x

12.8x

Ocado

1,153

1,153

5.1%

13.2%

0.9x

0.8x

18.4x

12.9x

NM

NM

YOOX

1,062

1,053

9.9%

27.7%

1.7x

1.4x

16.9x

12.8x

45.8x

32.9x

Digital River

495

99

16.1%

2.5%

0.3x

0.2x

1.6x

1.6x

19.8x

17.0x

Blue Nile

395

365

6.2%

11.8%

0.8x

0.7x

12.8x

9.2x

33.2x

24.1x

Overstock

306

212

2.4%

7.3%

0.2x

0.2x

7.5x

6.9x

29.0x

23.3x

Mean

20.5%

18.0%

2.9x

2.4x

14.2x

10.7x

27.6x

22.7x

Median

14.2%

17.1%

1.6x

1.4x

13.1x

11.0x

24.9x

21.4x

Online Travel

Priceline

34,947

31,864

38.3%

20.0%

5.1x

4.3x

13.2x

11.1x

18.6x

16.0x

Amadeus

11,433

13,535

38.1%

6.8%

3.3x

3.1x

8.7x

8.1x

14.3x

13.0x

Expedia

8,888

8,309

19.3%

16.9%

1.8x

1.6x

9.2x

8.0x

19.2x

16.1x

Tripadvisor

6,693

6,574

46.1%

20.0%

7.2x

6.2x

15.6x

13.2x

25.7x

21.9x

Ctrip

2,982

2,475

20.0%

18.6%

3.1x

2.6x

15.5x

12.2x

18.5x

15.1x

Travelzoo

336

274

19.1%

6.9%

1.7x

1.6x

9.0x

7.9x

18.2x

15.7x

Orbitz

291

579

16.5%

4.5%

0.7x

0.7x

4.3x

4.3x

11.4x

9.2x

Mean

28.2%

13.4%

3.3x

2.9x

10.8x

9.3x

18.0x

15.3x

Median

20.0%

16.9%

3.1x

2.6x

9.2x

8.1x

18.5x

15.7x

Online Marketing

HomeAway

2,011

1,767

29.9%

20.6%

5.2x

4.5x

17.5x

13.6x

NM

NM

ValueClick

1,629

1,684

32.7%

12.7%

2.3x

2.0x

6.9x

6.2x

12.2x

10.8x

LBI

505

517

17.3%

12.9%

1.4x

1.3x

8.2x

7.4x

13.4x

11.6x

Constant Contact

483

390

15.3%

13.8%

1.4x

1.2x

8.9x

7.4x

25.0x

19.3x

1000mercis

165

125

32.0%

7.9%

2.4x

2.2x

7.6x

7.0x

13.6x

12.1x

Marchex

151

116

13.1%

7.0%

0.8x

0.7x

6.0x

4.4x

NM

NM

Hi-Media

118

141

9.7%

6.2%

0.5x

0.5x

5.3x

5.5x

9.8x

10.0x

TradeDoubler

79

53

3.4%

(7.9%)

0.2x

0.1x

4.7x

3.6x