PI cuts price target on TSXV:TINY

PI Financial analyst Jason Zandberg is still bullish on TINY (TINY Stock Quote, Chart, News, Analysts, Financials TSXV:TINY), just a little less so.

In a research update to clients April 18, Zandberg maintained his “Buy” rating on TINY, but chopped his price target on the stock from $5.50 to $5.00, implying a return of 103.3% at the time of publication.

“We are still very bullish on TINY’s outlook and the ability for Co-CEOs Andrew Wilkinson and Chris Sparling to create significant value for shareholders but in light of our modification in our outlook along with lower trading multiples our 12-month target price has dropped to C$5.00 from C$5.50,” the analyst explained.

Zandberg expects TINY will post Adjusted EBITDA of $36.1-million on revenue of $220.9-million in fiscal 2024. He thinks those numbers will improve to Adjusted EBITDA of $53.3-million on a topline of $246.2-million in fiscal 2025.

“Our valuation approach includes using peer multiples along with our DCF calculation,” Zandberg concluded. “Peer multiples on EV/Sales have declined since we initiated our coverage in July 2023 while EV/EBITDA multiples have expanded. Using the same methodology but incorporating our new FY25 estimates and current peer multiples were are re-setting our 12-month target to C$5.00 (previously C$5.50). We expect TINY to focus on M&A in 2024. Most of the transactions that occurred in 2023 were within the TINY Fund but that fund has fully deployed its capital, so we expect the Company to invest its cash while also generating free cash flow from its current portfolio of businesses.”

What does TINY do? (via PI Financial)

Tiny Ltd. (TSXV-TINY) is a decentralized holding company that acquires primarily internet and technology-focused businesses. Tiny’s corporate team allows acquired businesses to operate autonomously while they focus on capital allocation, investment decisions and hiring/incentivizing senior management.