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Agronomics Limited
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===Relative valuation=== As noted earlier in this report, research suggests that in terms of estimating the expected return of an investment over a period of 12-months or more, the approach that is more accurate is the discounted cash flow approach, so that's the approach that Stockhub suggests using to determine the estimated value of the company (the valuation based on the discounted cash flow approach can be found in the valuation section of this report); nevertheless, for completeness purposes, separately, the valuation of the company is also estimated using the relative valuation approach. ====What's the expected return of an investment in Agronomics using the relative valuation approach?==== Stockhub estimates that the expected return of an investment in Agronomics over the next 12-months is ccc%. In other words, an £1,000 investment in the company is expected to return £ccc in one year time. The assumptions used to estimate the return figure can be found in the table below. ====What are the assumptions used to estimate the return figure?==== {| class="wikitable" |+Key inputs !Description !Value !Commentary |- |Which type of multiple do you want to use? |Book value growth-adjusted price-to-book value metric |The price-to-book value is really the only available commonly used value, so we suggest using that. To help compare peers at different stages of their business lifecycle, we suggest using the book value growth-adjusted price-to-book value. |- |In regards to the book value growth-adjusted price-to-book value multiple, for the book value figure, which year to you want to use? |Year 1 |Research suggests that when using the relative valuation approach, it's best to use a time period of 12 months or less. Accordingly, for the book value figure, we suggest using Year 1, which is on 12th September 2024. |- |In regards to the book value growth-adjusted price-to-book value multiple, what multiple figure do you want to use? |0.5x |Here, we suggest using a multiple of 0.50x, which is in-line with the multiples of Agronomics' peers (for details on the peers can be found in the table below). |- |What is the estimated compound annual growth rate of the book value between one year from now and the most recent value? |46.37% |One year from now is 12th September 2024, and the most recent book value date is 31st December 2022. For simplicity, we based the estimate on the CAGR of Agronomics over the last five years, which is 46.37%. The most recent value is $248,178,354 (as at 31st December 2022). |- |What's the current market capitalisation of the company? |£205.44 million |As at 12th September 2023, the market capitalisation of Agronomics is £205.44 million. |- |Which time period do you want to use to estimate the expected return? |Between now and one year time |Research suggests that when using the relative valuation approach, it's best to estimate the expected return of the company between now and one year time. |} ====Sensitivity analysis==== The main inputs that result in the greatest change in the expected return of the Agronomics investment are, in order of importance (from highest to lowest): #The compound annual growth rate of the Agronomics book value (the default figure is ccc%); #The price-to-book value multiple (the default multiple cccx); and #Agronomics most recent book value figure (the default figure is $ccc). The impact of a 50% change in those main inputs to the expected return of the Agronomics investment is shown in the table below. {| class="wikitable sortable" |+Agronomics investment expected return sensitivity analysis !Main input !50% worse !Unchanged !50% better |- |The compound annual growth rate of the Agronomics book value between one year ahead and the most recent value |113% |185% |266% |- |The price-to-book value multiple |42% |185% |327% |- |Agronomics most recent book value figure |42% |185% |327% |} {| class="wikitable" |+Local peers - BICS Best Fit (Algorithm) !Name !Ticker !2Y Corr !Mkt Cap (USD) !BF P/E !BF EV/EBITDA !BF EV/EBIT !BF EV/Rev !Last fiscal P/BV |- |Agronomics Limited |ANIC LN | | | | | | | |- | colspan="9" |'''Publicly listed companies in the broader alternative protein sector''' |- |Beyond Meat | | | | | | | | |- |Oatly | | | | | | | | |- |The Very Good Food Company | | | | | | | | |- | colspan="9" |'''Investment firms or funds that focus on the alternative protein or cellular agriculture space''' |- |New Crop Capital |N/A | | | | | | | |- |Blue Horizon Ventures |N/A | | | | | | | |- |Stray Dog Capital |N/A | | | | | | | |- | colspan="9" |'''Companies in the cellular agriculture or alternative protein space which might be considered peers or competitors to the portfolio companies of Agronomics''' |- |Memphis Meats |N/A | | | | | | | |- |Mosa Meat |N/A | | | | | | | |- |Impossible Foods |N/A | | | | | | | |- |Beyond Meat |N/A | | | | | | | |- |Perfect Day |N/A | | | | | | | |- |Geltor |N/A | | | | | | | |- | | | | | | | | | |- |Mean (Including ANIC LN) | | | | | | | | |- |Current Premium to Comps Mean | | | | | | | | |}
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