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European Technology Update 15th August 2013
Thierry Monjauze
Managing Director
63 Brook Street
London W1K 4HS
United Kingdom
Phone: +44 (0) 20 7518 8900 tmonjauze@harriswilliams.com
Francois Morin
Director
63 Brook Street
London W1K 4HS
United Kingdom
Phone: +44 (0) 20 7518 8900 fmorin@harriswilliams.com
www.harriswilliams.com
Member FINRA/SIPC
Publicis and Omnicom have agreed to merge to form Publicis Omnicom Group, the world’s largest advertising
holding company, which is estimated to have a combined market value of $35.1 billion
Cisco Systems has acquired Sourcefire, the provider of intelligent cybersecurity technology, for $2.4 billion
Satélites Mexicanos, the provider of fixed satellite services for telecommunication, has been acquired by
Eutelsat for $830 million
Avelo, the provider of technology solutions to the financial services industry, has been acquired by IRESS for
£210 million
Grendall Investment has acquired Cupid’s Casual Dating Business, a portfolio of casual dating sites, for £43
million
Kapow Software, the Big Data integration platform for managing critical data from various sources, has been
acquired by Kofax for $48 million
icon-scm, the provider of integrated supply chain management solutions, has been acquired by E2open for $34
million
Corero Business Systems, the developer of modular accounting and business management software solutions,
has been acquired by Civica for £13 million
Job Board Enterprises, the provider of IT recruitment services, has been acquired by Dice holdings for £12
million
Darwin Private Equity has acquired Esendex, the provider of SMS services to businesses, for £11 million
ICM Unternehmensberatung, the provider of SAP consulting and implementation services, has been acquired
by Alpha Group
Mandata, the developer of software for the transport and logistics industry, has been acquired by Synova
Capital
Newron Systems, a developer of building automation software solutions, was acquired by ABB
TKH Group has acquired Park Assist, the provider of car park guidance and management systems
SecondSync, the web-based data analytics platform for television broadcasts, has been acquired by Kantar
Retail
Dassault Systemes has acquired SFE, the developer of software tools for CAE-driven development
Ericsson has acquired Telcocell, the provider of consulting services to the telecommunications industry
Danaher has acquired Teletrac, a provider of vehicle fleet tracking systems and solutions
Tengelmann New Media, an e-commerce agency, has been acquired by Hirschen Group
uSwitch, the provider of online and telephone comparison and switching services, has been acquired by LDC
Forrester has decreased its 2013-2014 global technology spending forecast from 3.3%, made in January, to
2.3% due to lower than expected growth in Europe and China despite stronger performance from US and Japan
UK digital ad investment is expected to reach £6.3 billion in 2013 and rise to £8.4 billion by 2017, driven by
mobile and video ads, according to eMarketer
Tablets are forecast to exceed 381 million units in worldwide sales in 2017 and reach an installed base of 905
million as they join PCs and smartphones as “mainstay” devices, according to Forrester
UK B2C e-commerce sales are expected to be £62.5 billion in 2013 and reach £89.7 billion, or 16% of total UK
retail sales, by 2017, as UK consumers remain one of the most prominent e-commerce users in the world,
according to eMarketer
UK consumers are increasingly turning to mobile for shopping as the UK m-commerce conversion rate rose
from 1.27% in June 2012 to 2.03% in June 2013, as consumers become more comfortable making purchases
using their smartphones and tablets, according to eMarketer
More than a third of web users in Europe are using mobile banking, with Turkey, Spain and the Netherlands
leading the way with close to half of internet users. In particular, mobile banking was found to be more
prominent in users aged 25 to 34, with almost half of the age group as regular users compared to 37% across all
ages, according to eMarketer
Recent Developments
Source: Various industry news outlets.
Company
Specific
News
Industry
Trends
1
(10%)
0%
10%
20%
30%
40%
50%
60%
70%
Aug 2012 Nov 2012 Feb 2013 May 2013 Aug 2013
Nasdaq Composite Internet and Digital Media Software and IT Services Communications DJ Stoxx 600 Technology
(2%)
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
09 Jul 14 Jul 19 Jul 24 Jul 29 Jul 03 Aug 08 Aug
Nasdaq Composite Internet and Digital Media Software and IT Services Communications DJ Stoxx 600 Technology
Stock
Performance
Comparable
Trading
Summary
Last Twelve Months
Last 30 Days
Public Market Trading Statistics
2
Sources: Capital IQ, 9 August 2013; Brokers’ reports.
16.5%
12.6%
9.2%
5.2%
3.4%
61.4%
45.1%
37.4%
32.7%
21.1%
CY2013E
EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
Software and IT Services
Enterprise Applications 12.9% 6.8% 2.5x 2.2x 8.2x 11.8x 18.5x 13.9x
European Large Cap Software 33.0% 3.1% 4.1x 3.9x 12.5x 11.3x 19.9x 17.6x
Financial Software 25.9% 3.2% 2.7x 2.5x 10.4x 9.4x 19.4x 17.7x
Healthcare Software 20.5% 11.1% 2.5x 2.3x 11.3x 9.4x 21.9x 17.2x
Large Cap IT Services 13.7% 10.2% 1.1x 1.1x 7.9x 7.3x 15.3x 13.9x
Mid Cap IT Services 8.3% 10.8% 3.6x 2.8x 6.1x 5.6x 11.7x 9.0x
Offshore IT Services 23.1% 6.8% 2.7x 2.4x 11.2x 10.0x 16.2x 14.4x
Security Software 35.4% 5.7% 3.4x 3.2x 8.9x 8.2x 16.5x 15.0x
Communications
Digital Broadband 11.3% (2.8%) 0.6x 0.6x 5.6x 4.8x 15.7x 11.9x
Diversified Communication Equipment 8.5% 0.6% 1.1x 1.0x 11.7x 8.5x 30.1x 22.1x
Mobile Content / Solutions Providers 22.7% 27.9% 2.5x 2.0x 10.8x 8.2x 23.8x 16.6x
Mobile Infrastructure Software 18.4% 39.1% 2.6x 2.4x 15.1x 14.6x 17.7x 16.0x
Internet and Digital Media
Chinese Internet Leaders 17.6% 288.0% 4.5x 3.5x 14.5x 16.2x 24.1x 24.3x
Online Classifieds 40.0% 18.0% 7.7x 6.3x 13.3x 11.4x 21.0x 17.7x
Content Providers / Communities 20.4% 23.5% 4.6x 4.0x 12.7x 20.1x 28.6x 24.4x
Ecommerce 20.9% 34.0% 3.6x 3.0x 19.4x 15.0x 28.9x 26.2x
Global Internet Leaders 36.6% 19.9% 5.5x 4.6x 15.6x 12.8x 20.0x 19.9x
Interactive Entertainment 18.3% (0.3%) 1.8x 1.6x 14.5x 10.8x 14.4x 14.6x
Intermediation and Comparison 17.3% 21.7% 5.3x 4.2x 14.0x 16.0x 29.8x 20.1x
Online Gambling 26.4% 1.4% 3.0x 2.8x 10.8x 10.1x 17.7x 16.2x
Online Marketing 14.6% 6.6% 1.8x 1.6x 11.7x 9.9x 22.0x 22.0x
Online Travel 27.4% 17.4% 4.9x 4.1x 16.4x 13.4x 24.7x 23.9x
P / EEV / Revenue EV / EBITDA
(10%)
0%
10%
20%
30%
40%
50%
60%
Aug 2012 Nov 2012 Feb 2013 May 2013 Aug 2013
European Large Cap Software Financial Software
Enterprise Applications Healthcare Software
Security Software Large Cap IT Services
Mid Cap IT Services Offshore IT Services
(5%)
0%
5%
10%
15%
20%
25%
09 Jul 14 Jul 19 Jul 24 Jul 29 Jul 03 Aug 08 Aug
European Large Cap Software Financial Software
Enterprise Applications Healthcare Software
Security Software Large Cap IT Services
Mid Cap IT Services Offshore IT Services
Software and IT Services
Source: Capital IQ, 9 August 2013.
Last Twelve Months Performance
Last 30 Days Performance
3
Financial Software 44.9%
Large Cap IT Services 42.8%
Mid Cap IT Services 41.1%
Healthcare Software 36.7%
European Large Cap Software 34.5%
Security Software 28.9%
Offshore IT Services 25.7%
Enterprise Applications 14.9%
Offshore IT Services 16.9%
Mid Cap IT Services 11.1%
Financial Software 10.8%
European Large Cap Software 9.8%
Large Cap IT Services 9.5%
Enterprise Applications 8.5%
Security Software 5.2%
Healthcare Software 0.1%
Software and IT Services
(Continued)
4 Sources: Capital IQ, 9 August 2013; Brokers’ reports.
Market Enterprise CY2013E
Cap ($m) Value ($m) EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
European Large Cap Software
SAP 89,331 91,432 34.6% 8.2% 3.9x 3.6x 11.4x 10.1x 16.6x 14.8x
Dassault Systemes 16,442 14,390 33.4% 6.7% 5.0x 4.6x 15.1x 13.5x 27.3x 24.4x
Sage 6,160 6,517 29.6% (1.8%) 3.0x 2.9x 10.2x 9.8x 15.7x 14.3x
Software AG 2,738 2,851 26.5% (5.6%) 2.1x 2.0x 8.1x 7.5x 12.8x 11.5x
Aveva 2,455 2,160 33.0% 8.0% 5.8x 5.2x 17.5x 15.1x 28.9x 24.6x
Temenos 1,904 2,056 28.9% 6.3% 4.3x 4.0x 15.0x 13.0x 24.6x 21.0x
Micro Focus 1,840 2,017 45.2% 0.1% 4.8x 4.7x 10.6x 10.3x 13.3x 12.5x
Mean 33.0% 3.1% 4.1x 3.9x 12.5x 11.3x 19.9x 17.6x
Median 33.0% 6.3% 4.3x 4.0x 11.4x 10.3x 16.6x 14.8x
Financial Software
Intuit 19,137 17,641 39.3% 7.3% 3.9x 3.6x 9.9x 9.3x 18.7x 16.9x
Temenos 1,904 2,056 28.9% 6.3% 4.3x 4.0x 15.0x 13.0x 24.6x 21.0x
SimCorp 1,333 1,256 25.6% 11.8% 4.1x 3.6x 15.9x 13.6x 20.7x 20.2x
Fidessa 1,241 1,163 27.4% (3.8%) 2.7x 2.6x 9.7x 9.2x 26.5x 24.9x
Innovation 463 426 13.6% 2.4% 1.3x 1.2x 9.5x 8.5x 20.9x 17.9x
Linedata 191 233 24.1% 13.9% 1.1x 1.0x 4.5x 4.3x 9.4x 8.8x
Microgen 174 132 32.3% (10.8%) 2.8x 2.7x 8.7x 8.6x 16.0x 15.8x
StatPro 84 79 16.1% (1.5%) 1.6x 1.5x 9.8x 8.9x 18.5x 16.2x
Mean 25.9% 3.2% 2.7x 2.5x 10.4x 9.4x 19.4x 17.7x
Median 26.5% 4.4% 2.7x 2.6x 9.8x 9.1x 19.7x 17.4x
Enterprise Applications
Guidewire Software 2,507 2,353 10.9% 23.5% 7.6x 6.2x NM 47.6x NM NM
Unit 4 1,010 1,185 19.8% 6.0% 1.8x 1.7x 9.1x 7.9x 26.4x 18.8x
Jive Software 921 795 (19.5%) 29.3% 5.5x 4.4x NM NM NM NM
Exact 533 458 22.3% 0.4% 1.6x 1.5x 7.1x 7.0x 13.7x 13.4x
IFS 518 498 11.0% 1.7% 1.2x 1.1x 10.8x 7.0x 22.0x 14.6x
Kofax 438 355 17.2% (0.1%) 1.3x 1.2x 7.5x 7.1x 16.6x 15.1x
SDL 435 434 8.0% (3.9%) 1.0x 1.0x 12.9x 8.5x 27.0x 14.6x
F-Secure 352 307 21.6% 2.6% 1.4x 1.4x 6.7x 6.2x 15.6x 12.8x
Cegid 187 278 25.0% 1.7% 0.8x 0.8x 3.1x 3.0x 8.2x 7.8x
Mean 12.9% 6.8% 2.5x 2.2x 8.2x 11.8x 18.5x 13.9x
Median 17.2% 1.7% 1.4x 1.4x 7.5x 7.0x 16.6x 14.6x
Healthcare Software
McKesson 28,397 30,366 2.6% 4.2% 0.2x 0.2x 9.2x 8.2x 17.0x 13.9x
Cerner 16,723 15,935 33.0% 11.8% 5.4x 4.8x 16.3x 14.0x 34.6x 29.5x
Allscripts Healthcare Solutions 2,726 3,198 13.7% (2.9%) 2.2x 2.1x 16.3x 11.3x 42.0x 25.1x
CompuGroup 1,059 1,354 21.3% 2.7% 2.2x 2.1x 10.3x 8.4x 14.0x 11.3x
Emis 688 682 33.7% 8.1% 4.5x 4.2x 13.3x 11.9x 23.1x 20.1x
Advanced Computer Software 592 545 22.2% 51.0% 2.0x 1.7x 8.9x 7.7x 16.4x 14.9x
Cegedim 379 1,048 17.3% 2.6% 0.8x 0.8x 4.9x 4.6x 6.0x 5.3x
Mean 20.5% 11.1% 2.5x 2.3x 11.3x 9.4x 21.9x 17.2x
Median 21.3% 4.2% 2.2x 2.1x 10.3x 8.4x 17.0x 14.9x
EV / Revenue EV / EBITDA P / E
Software and IT Services
(Continued)
5 Sources: Capital IQ, 9 August 2013; Brokers’ reports.
Market Enterprise CY2013E
Cap ($m) Value ($m) EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
Security Software
Symantec 18,737 17,048 30.7% 2.1% 2.5x 2.4x 8.0x 6.9x 14.7x 12.9x
Check Point 11,521 10,280 58.8% 3.3% 7.4x 7.0x 12.6x 11.9x 17.3x 15.9x
Trend Micro 4,528 3,207 31.6% 2.8% 2.9x 2.8x 9.1x 8.8x 24.3x 23.9x
AVG Technologies 1,184 1,179 34.4% 17.8% 2.8x 2.5x 8.1x 7.4x 10.6x 9.3x
F-Secure 352 307 21.6% 2.6% 1.4x 1.4x 6.7x 6.2x 15.6x 12.8x
Mean 35.4% 5.7% 3.4x 3.2x 8.9x 8.2x 16.5x 15.0x
Median 31.6% 2.8% 2.8x 2.5x 8.1x 7.4x 15.6x 12.9x
Large Cap IT Services
Accenture 47,416 41,960 16.5% 1.7% 1.5x 1.4x 8.9x 8.4x 17.5x 16.0x
CGI 10,531 13,343 14.3% 59.3% 1.3x 1.3x 9.4x 8.3x 15.6x 12.9x
Capita Group 10,334 12,758 15.4% 10.7% 2.1x 1.9x 13.8x 12.6x 18.0x 16.4x
Cap Gemini 9,015 8,808 10.2% 0.8% 0.6x 0.6x 6.4x 6.0x 14.5x 13.4x
Computer Sciences 7,692 8,486 15.1% (12.2%) 0.6x 0.6x 4.1x 4.0x 13.0x 12.7x
Atos Origin 6,843 6,575 11.0% 1.0% 0.6x 0.5x 5.1x 4.7x 13.3x 12.1x
Mean 13.7% 10.2% 1.1x 1.1x 7.9x 7.3x 15.3x 13.9x
Median 14.7% 1.3% 1.0x 1.0x 7.6x 7.2x 15.1x 13.2x
Mid Cap IT Services
Splunk 5,370 5,039 2.4% 41.3% 18.4x 13.8x NM NM NM NM
Indra Sistemas 2,495 3,360 9.6% 3.7% 0.8x 0.8x 8.8x 8.1x 14.3x 11.9x
Tieto 1,437 1,545 12.6% (5.7%) 0.7x 0.7x 5.3x 5.0x 13.2x 10.3x
Sopra 908 1,196 9.2% 11.7% 0.7x 0.6x 7.4x 6.6x 10.0x 9.0x
Groupe Steria 461 849 8.7% (2.2%) 0.4x 0.3x 4.1x 3.8x 6.6x 5.1x
GFI Informatique 264 348 7.1% 15.7% 0.3x 0.3x 4.8x 4.6x 14.2x 8.7x
Mean 8.3% 10.8% 3.6x 2.8x 6.1x 5.6x 11.7x 9.0x
Median 8.9% 7.7% 0.7x 0.7x 5.3x 5.0x 13.2x 9.0x
Offshore IT Services
Tata 59,544 57,152 28.6% 12.0% 4.7x 4.0x 16.4x 14.1x 22.4x 18.7x
Infosys 27,884 24,412 25.5% 8.3% 3.2x 2.9x 12.5x 11.3x 17.6x 15.8x
Cognizant 22,048 19,148 20.7% 19.1% 2.2x 1.9x 10.6x 9.2x 17.1x 14.9x
Wipro 18,013 16,547 20.7% (12.7%) 2.5x 2.3x 12.0x 10.9x 16.3x 14.6x
HCL 10,389 9,993 22.6% 9.8% 2.1x 1.9x 9.3x 8.8x 13.5x 12.7x
Satyam 2,233 1,773 20.2% 4.1% 1.3x 1.2x 6.2x 5.9x 10.2x 9.4x
Mean 23.1% 6.8% 2.7x 2.4x 11.2x 10.0x 16.2x 14.4x
Median 21.7% 9.1% 2.3x 2.1x 11.3x 10.0x 16.7x 14.8x
EV / Revenue EV / EBITDA P / E
(5%)
0%
5%
10%
15%
20%
25%
09 Jul 14 Jul 19 Jul 24 Jul 29 Jul 03 Aug 08 Aug
Digital Broadband Diversified Communication Equipment
Mobile Infrastructure Software Mobile Content / Solutions Providers
(30%)
(20%)
(10%)
0%
10%
20%
30%
40%
50%
60%
Aug 2012 Nov 2012 Feb 2013 May 2013 Aug 2013
Digital Broadband Diversified Communication Equipment
Mobile Infrastructure Software Mobile Content / Solutions Providers
Last 30 Days Performance
Last Twelve Months Performance
Communications
6 Source: Capital IQ, 9 August 2013.
Diversified Communication Equipment 50.9%
Mobile Infrastructure Software 47.1%
Digital Broadband 46.2%
Mobile Content / Solutions Providers 32.6%
Mobile Content / Solutions Providers 21.1%
Diversified Communication Equipment 19.6%
Digital Broadband 15.8%
Mobile Infrastructure Software 13.4%
Communications
(Continued)
7 Sources: Capital IQ, 9 August 2013; Brokers’ reports.
Market Enterprise CY2013E
Cap ($m) Value ($m) EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
Digital Broadband
Technicolor 1,672 2,649 15.0% (1.2%) 0.6x 0.6x 3.7x 3.6x 10.2x 7.9x
Pace 1,475 1,545 9.5% (0.9%) 0.6x 0.6x 6.6x 6.4x 11.4x 10.1x
TomTom 1,340 1,331 14.1% (9.3%) 1.1x 1.1x 7.5x 7.2x 19.6x 17.2x
Logitech 1,187 860 5.5% (7.8%) 0.4x 0.4x 7.6x 5.2x 25.7x 19.8x
Kudelski 712 895 14.2% 0.6% 0.9x 0.9x 6.6x 6.3x 12.2x 11.4x
Parrot 320 220 10.6% (6.5%) 0.6x 0.6x 5.9x 3.7x 23.1x 10.5x
Advanced Digital Broadcast 81 58 10.0% 5.8% 0.1x 0.1x 1.3x 1.2x 7.4x 6.4x
Mean 11.3% (2.8%) 0.6x 0.6x 5.6x 4.8x 15.7x 11.9x
Median 10.6% (1.2%) 0.6x 0.6x 6.6x 5.2x 12.2x 10.5x
Diversified Communication Equipment
LM Ericsson Telephone 39,304 33,647 12.1% 2.2% 1.0x 0.9x 7.8x 6.4x 17.6x 13.6x
Nokia 15,468 11,178 6.2% (17.5%) 0.3x 0.3x 5.5x 4.1x NM 26.7x
Alcatel-Lucent 6,134 8,151 5.4% 1.1% 0.4x 0.4x 7.8x 5.3x NM NM
CIENA 2,299 3,053 8.2% 13.3% 1.4x 1.3x 17.7x 13.0x 39.8x 21.9x
ADTRAN 1,517 1,372 10.8% 3.9% 2.1x 1.9x 19.7x 13.8x 32.9x 26.0x
Mean 8.5% 0.6% 1.1x 1.0x 11.7x 8.5x 30.1x 22.1x
Median 8.2% 2.2% 1.0x 0.9x 7.8x 6.4x 32.9x 23.9x
Mobile Infrastructure Software
QUALCOMM 113,681 102,245 38.2% 25.9% 4.0x 3.6x 10.4x 9.8x 14.5x 13.2x
VeriSign 7,001 6,360 64.1% 9.9% 6.6x 6.2x 10.3x 9.7x 21.1x 19.0x
Amdocs 6,141 5,050 21.1% 3.5% 1.5x 1.4x 7.1x 7.0x 13.0x 12.2x
Synchronoss Technologies 1,358 1,308 31.4% 28.8% 3.7x 3.1x 11.9x 9.4x 26.6x 21.2x
Sonus Networks 981 769 0.5% 6.3% 2.8x 2.7x NM NM NM NM
Redknee Solutions 334 319 3.4% 249.8% 1.5x 1.2x 45.1x 45.1x NM NM
TeleCommunication Systems 158 252 10.8% (14.8%) 0.6x 0.6x 5.7x 6.8x 13.5x 14.2x
Smith Micro Software 39 16 (22.5%) 3.7% 0.4x 0.3x NM NA NM NM
Mean 18.4% 39.1% 2.6x 2.4x 15.1x 14.6x 17.7x 16.0x
Median 15.9% 8.1% 2.2x 2.0x 10.4x 9.6x 14.5x 14.2x
Mobile Content / Solutions Providers
Opera Software 994 940 26.8% 37.7% 3.2x 2.5x 11.9x 8.3x 25.5x 15.4x
GameLoft 663 589 18.6% 18.0% 1.8x 1.6x 9.7x 8.1x 22.2x 17.8x
Mean 22.7% 27.9% 2.5x 2.0x 10.8x 8.2x 23.8x 16.6x
Median 22.7% 27.9% 2.5x 2.0x 10.8x 8.2x 23.8x 16.6x
EV / Revenue EV / EBITDA P / E
(5%)
0%
5%
10%
15%
20%
25%
30%
35%
09 Jul 14 Jul 19 Jul 24 Jul 29 Jul 03 Aug 08 Aug
Global Internet Leaders Ecommerce
Online Travel Online Marketing
Content Providers / Communities Intermediation and Comparison
Online Classifieds Chinese Internet Leaders
Online Gambling Interactive Entertainment
(20%)
0%
20%
40%
60%
80%
100%
120%
140%
Aug 2012 Nov 2012 Feb 2013 May 2013 Aug 2013
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
Last 30 Days Performance
Internet and Digital Media
8 Source: Capital IQ, 9 August 2013.
Chinese Internet Leaders 30.2%
Content Providers / Communities 24.5%
Online Travel 19.2%
Interactive Entertainment 17.5%
Online Gambling 16.7%
Online Classifieds 15.9%
Ecommerce 8.4%
Online Marketing 7.0%
Intermediation and Comparison 6.4%
Global Internet Leaders 5.2%
Ecommerce 115.8%
Online Travel 84.7%
Online Gambling 76.3%
Content Providers / Communities 69.4%
Chinese Internet Leaders 57.0%
Interactive Entertainment 48.7%
Online Classifieds 47.3%
Online Marketing 29.2%
Intermediation and Comparison 25.1%
Global Internet Leaders 18.4%
Internet and Digital Media
(Continued)
9 Sources: Capital IQ, 9 August 2013; Brokers’ reports.
Market Enterprise CY2013E
Cap ($m) Value ($m) EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
Global Internet Leaders
Apple 412,866 387,149 31.6% 3.1% 2.3x 2.1x 7.2x 6.7x 11.8x 10.4x
Google 296,525 250,293 36.1% 12.6% 4.2x 3.7x 11.7x 9.9x 20.5x 17.3x
Microsoft 272,390 212,466 39.8% 11.3% 2.6x 2.5x 6.6x 6.3x 12.0x 11.2x
Amazon 135,813 131,392 6.7% 19.8% 1.8x 1.5x 26.5x 19.3x NM NM
Facebook 93,760 85,675 55.3% 45.6% 11.7x 9.0x 21.2x 16.4x NM 41.2x
eBay 69,037 63,134 33.7% 15.0% 3.9x 3.4x 11.6x 10.0x 19.6x 16.7x
Baidu 48,335 44,918 44.8% 42.0% 9.0x 6.8x 20.0x 15.9x 27.8x 22.6x
Yahoo! 28,242 25,713 35.6% 0.6% 5.7x 5.6x 16.1x 15.3x 19.0x 16.4x
Yandex 10,785 10,568 45.5% 29.0% 8.7x 7.0x 19.2x 15.5x 29.2x 23.5x
Mean 36.6% 19.9% 5.5x 4.6x 15.6x 12.8x 20.0x 19.9x
Median 36.1% 15.0% 4.2x 3.7x 16.1x 15.3x 19.6x 17.0x
Ecommerce
Amazon 135,813 131,392 6.7% 19.8% 1.8x 1.5x 26.5x 19.3x NM NM
Facebook 93,760 85,675 55.3% 45.6% 11.7x 9.0x 21.2x 16.4x NM 41.2x
eBay 69,037 63,134 33.7% 15.0% 3.9x 3.4x 11.6x 10.0x 19.6x 16.7x
Netflix 14,893 14,313 10.6% 20.7% 3.3x 2.8x 31.2x 27.7x NM NM
Groupon 7,061 5,877 12.4% 9.5% 2.3x 2.0x 18.5x 14.5x NM 36.5x
Mail.ru 6,681 5,732 54.5% 265.4% 2.3x 1.7x 4.2x 3.4x 6.7x 5.3x
Mercadolibre 5,460 5,273 35.9% 25.3% 11.2x 9.1x 31.2x 24.9x 44.6x 35.2x
IAC 4,183 4,192 19.6% 15.2% 1.3x 1.2x 6.7x 5.6x 13.2x 11.1x
Ocado 2,539 2,585 5.6% 11.8% 2.2x 1.8x 38.7x 23.6x NM NM
Shutterfly 2,088 1,961 19.1% 30.4% 2.5x 2.1x 13.2x 10.9x 40.0x 34.3x
YOOX 1,942 1,933 9.8% 27.3% 3.1x 2.5x 31.5x 23.5x NM NM
Vistaprint 1,816 2,004 12.5% 10.7% 1.6x 1.5x 13.2x 10.3x 22.2x 17.9x
OpenTable 1,578 1,486 42.3% 16.7% 7.9x 6.7x 18.7x 15.4x 36.4x 31.1x
Overstock 712 627 3.3% 15.2% 0.5x 0.5x 14.9x 12.7x 30.6x 24.6x
Digital River 610 344 8.1% 3.7% 0.9x 0.9x 10.6x 6.5x 29.9x 24.3x
Blue Nile 468 421 5.1% 11.8% 0.9x 0.8x 18.0x 14.6x 45.8x 35.6x
Mean 20.9% 34.0% 3.6x 3.0x 19.4x 15.0x 28.9x 26.2x
Median 12.4% 15.9% 2.3x 1.9x 18.3x 14.6x 30.2x 27.8x
Online Travel
Priceline 49,950 46,300 37.9% 27.4% 6.9x 5.6x 18.2x 14.5x 24.3x 19.7x
Amadeus 14,846 16,624 38.6% 7.1% 4.1x 3.8x 10.6x 9.9x 18.3x 16.8x
Tripadvisor 11,573 11,562 40.1% 24.6% 12.2x 9.9x 30.5x 23.4x 47.2x 36.2x
Expedia 6,892 6,339 17.5% 18.1% 1.3x 1.2x 7.7x 6.6x 16.3x 14.0x
Ctrip 5,487 4,796 22.4% 27.7% 5.6x 4.5x 24.9x 19.1x 32.7x 25.9x
Orbitz 1,280 1,508 16.6% 9.3% 1.8x 1.7x 10.7x 9.6x 8.0x 32.3x
Travelzoo 459 386 19.1% 7.8% 2.4x 2.2x 12.5x 10.8x 25.9x 22.2x
Mean 27.4% 17.4% 4.9x 4.1x 16.4x 13.4x 24.7x 23.9x
Median 22.4% 18.1% 4.1x 3.8x 12.5x 10.8x 24.3x 22.2x
Online Marketing
HomeAway 2,589 2,253 27.9% 21.8% 6.6x 5.5x 23.7x 19.0x NM NM
ValueClick 1,574 1,550 34.3% 6.4% 2.2x 2.0x 6.4x 5.9x 13.0x 11.1x
Constant Contact 539 440 15.7% 13.7% 1.5x 1.4x 9.8x 8.1x 26.1x 20.8x
Marchex 246 227 8.4% 7.8% 1.5x 1.4x 18.3x 13.8x 47.7x 34.0x
1000mercis 194 150 31.9% 7.9% 2.9x 2.6x 9.1x 8.2x 16.0x 13.9x
TradeDoubler 141 115 4.3% (11.3%) 0.4x 0.3x 8.2x 7.1x 17.7x 14.8x
Hi-Media 106 133 7.9% 4.0% 0.5x 0.5x 6.2x 5.5x 11.8x 10.4x
ad pepper media 24 11 (2.3%) (1.6%) 0.1x 0.1x NM 7.6x NM 43.8x
Mean 14.6% 6.6% 1.8x 1.6x 11.7x 9.9x 22.0x 22.0x
Median 8.4% 7.8% 1.5x 1.4x 9.4x 8.1x 17.7x 17.8x
Content Providers / Communities
LinkedIn 26,098 25,224 24.2% 59.8% 16.7x 11.8x NM 44.9x NM NM
Pandora Media 3,444 3,368 2.6% 48.8% 5.3x 3.9x NM 49.3x NM NM
Perform Group 2,213 2,174 25.7% 34.4% 6.6x 5.4x 25.6x 18.8x 35.3x 26.3x
WebMD Health 1,640 1,414 22.1% 10.6% 2.8x 2.6x 12.5x 10.8x 40.6x 29.3x
Move 563 531 12.4% 14.8% 2.3x 2.1x 18.9x 13.8x 32.9x 22.4x
Demand Media 554 504 23.6% 6.0% 1.3x 1.1x 5.3x 4.9x 21.0x 18.9x
XING 527 441 29.0% 14.8% 4.0x 3.6x 13.7x 11.1x 37.0x 27.1x
Meetic 382 297 23.7% 17.9% 1.1x NA 4.7x NA 9.6x NA
XO Group 297 214 20.2% 4.3% 1.6x 1.5x 7.8x 7.0x 23.9x 22.1x
Mean 20.4% 23.5% 4.6x 4.0x 12.7x 20.1x 28.6x 24.4x
Median 23.6% 14.8% 2.8x 3.1x 12.5x 12.5x 32.9x 24.3x
EV / Revenue EV / EBITDA P / E
Internet and Digital Media
(Continued)
10 Sources: Capital IQ, 9 August 2013; Brokers’ reports.
Market Enterprise CY2013E
Cap ($m) Value ($m) EBITDA Margin Growth CY2013E CY2014E CY2013E CY2014E CY2013E CY2014E
Intermediation and Comparison
Zillow 3,284 3,114 11.4% 65.9% 16.5x 11.9x NM NM NM NM
Bankrate 1,725 1,807 26.3% (2.9%) 4.0x 3.5x 15.0x 12.4x 32.6x 23.8x
Moneysupermarket 1,556 1,516 35.4% 4.2% 4.4x 4.1x 12.4x 11.2x 17.5x 15.7x
Angie's List 1,413 1,362 (5.0%) 59.5% 5.5x 4.0x NM 42.9x NM NM
Liquidity Services 964 901 21.5% (1.3%) 1.8x 1.7x 8.5x 7.4x 17.1x 15.1x
eHealth 530 440 14.2% 10.9% 2.5x 2.2x 17.9x 11.6x 44.8x 28.5x
Gruppo MutuiOnline 184 159 17.0% 15.6% 2.7x 2.1x 16.1x 10.4x 37.1x 17.5x
Mean 17.3% 21.7% 5.3x 4.2x 14.0x 16.0x 29.8x 20.1x
Median 17.0% 10.9% 4.0x 3.5x 15.0x 11.4x 32.6x 17.5x
Online Classifieds
Rightmove 3,659 3,649 74.4% 12.9% 17.1x 14.9x 23.0x 19.9x 31.4x 26.4x
Yelp 3,382 3,285 12.4% 64.6% 14.6x 10.0x NM NM NM NM
SouFun 3,148 3,227 51.6% 39.5% 5.5x 4.7x 10.6x 9.1x 14.4x 12.4x
SEEK 2,854 3,381 38.6% 14.3% 5.4x 4.6x 14.0x 11.9x 20.5x 17.4x
Carsales.au 2,131 2,110 55.1% 2.7% 9.8x 8.7x 17.8x 15.5x 25.7x 22.2x
51job 2,003 1,535 34.5% 12.1% 5.9x 5.0x 17.0x 13.4x 24.7x 18.8x
Monster 523 583 18.4% (10.0%) 0.7x 0.7x 3.9x 3.7x 13.9x 12.6x
Dice 511 497 35.1% 8.1% 2.4x 2.2x 6.8x 6.1x 16.2x 14.2x
Mean 40.0% 18.0% 7.7x 6.3x 13.3x 11.4x 21.0x 17.7x
Median 36.8% 12.5% 5.7x 4.8x 14.0x 11.9x 20.5x 17.4x
Chinese Internet Leaders
Tencent 84,695 83,967 37.4% 39.9% 8.6x 6.7x 22.9x 18.9x 32.0x 26.3x
Baidu 48,335 44,918 44.8% 42.0% 9.0x 6.8x 20.0x 15.9x 27.8x 22.6x
Netease 7,842 5,370 51.0% 16.1% 3.5x 3.1x 6.9x 5.9x 11.3x 10.1x
Sina 5,211 4,536 10.4% 18.7% 7.3x 5.8x NM 30.2x NM 46.4x
Youku Tudou 3,863 3,296 (7.6%) 76.7% 6.6x 4.5x NM 34.4x NM NM
SouFun 3,148 3,227 51.6% 39.5% 5.5x 4.7x 10.6x 9.1x 14.4x 12.4x
Sohu 2,372 2,026 24.2% 30.5% 1.5x 1.3x 6.1x 5.2x 25.5x 17.8x
Renren 1,458 604 (37.9%) 38.1% 2.5x 1.9x NM NM NM NM
Dangdang 814 721 (4.3%) 25.4% 0.7x 0.6x NM NM NM NM
Jiayuan 250 160 16.1% 25.9% 2.0x 1.7x 12.1x 10.2x 24.3x 20.6x
Taomee 189 73 8.3% (3.4%) 1.9x 1.7x 22.5x NA 33.7x 38.3x
Mean 17.6% 288.0% 4.5x 3.5x 14.5x 16.2x 24.1x 24.3x
Median 16.1% 30.5% 3.5x 3.1x 12.1x 18.2x 25.5x 21.6x
Online Gambling
Playtech 3,140 3,067 45.7% 11.5% 6.3x 5.7x 13.8x 13.2x 16.2x 15.1x
bwin.party digital entertainment 1,727 1,556 19.8% (9.7%) 1.6x 1.6x 8.3x 7.4x 13.6x 12.0x
Betfair 1,513 1,253 21.9% (2.2%) 2.1x 2.0x 9.5x 9.1x 22.6x 20.2x
888 897 816 18.0% 5.9% 2.1x 2.0x 11.4x 10.8x 18.4x 17.5x
Mean 26.4% 1.4% 3.0x 2.8x 10.8x 10.1x 17.7x 16.2x
Median 20.9% 1.8% 2.1x 2.0x 10.5x 9.9x 17.3x 16.3x
Interactive Entertainment
Activision 19,288 14,742 33.7% (10.5%) 3.4x 3.2x 10.2x 8.7x 19.6x 14.4x
Electronic Arts 8,171 7,324 22.3% 11.5% 1.7x 1.8x 7.7x 10.1x 16.4x 20.2x
Zynga 2,413 1,298 2.1% (28.8%) 1.5x 1.7x NM 28.4x NM NM
Take-Two Interactive Software 1,725 1,654 3.6% 14.2% 1.4x 0.9x 37.6x 4.9x 7.5x 9.7x
Ubisoft Entertainment 1,531 1,384 29.7% 12.2% 0.8x 0.7x 2.5x 1.9x 13.9x 14.0x
Mean 18.3% (0.3%) 1.8x 1.6x 14.5x 10.8x 14.4x 14.6x
Median 22.3% 11.5% 1.5x 1.7x 8.9x 8.7x 15.2x 14.2x
EV / Revenue EV / EBITDA P / E
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TMT Group Overview
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