First Berlin – ad pepper media International N.V. Research Update (20/07/2020)

First Berlin Equity Research has published a research update on ad pepper media International N.V. (ISIN: NL0000238145). Analyst Dr. Karsten von Blumenthal upgraded the stock to BUY and increased the price target from EUR 3.70 to EUR 4.70.

Following publication of excellent preliminary Q2 figures management is guiding towards EBITDA of €4.5m in 2020 (2019 EBITDA: €3.5m). This corresponds to expected EBITDA growth of almost 29% in a year which will likely see the worst recession since World War II. If achieved, this would be an amazing performance, and we have no doubt that ad pepper will reach it. We had expected digitisation trends to counter recessionary headwinds. However, the pandemic has led to a much greater shift in advertising budgets from offline to online than we had anticipated. This massive shift has far outweighed shrinking ad budgets. And as a purely digital advertising company, ad pepper is benefitting tremendously from this shift. We increase our forecasts for 2020E and the following years. An updated DCF model yields a new price target of €4.70 (previously: €3.70). We upgrade the stock from Add to Buy.