Editing Stockhub
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[[File:Stockhub logo icon meta tag.png|thumb]] | |||
Helping to make more money for everyone (and not just the wealthy!). | |||
{| class="wikitable" | {| class="wikitable" | ||
|+ Key information | |+ Key information | ||
|- | |- | ||
| Risk/return|| | | Risk/return|| High | ||
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| Price per share|| | | Price per share|| £10 | ||
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| Asset class|| | | Asset class|| Equities<ref name=":0">https://find-and-update.company-information.service.gov.uk/company/13169692</ref> | ||
|- | |- | ||
| Industry|| | | Industry|| Fintech | ||
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| Country of incorporation|| | | Country of incorporation|| United Kingdom<ref name=":0" /> | ||
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| Minimum investment amount|| | | Minimum investment amount|| £10 | ||
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| Maximum investment amount|| | | Maximum investment amount|| £500,000 | ||
|- | |- | ||
| Current valuation|| | | Current valuation|| £4,000,000 | ||
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| Investor type|| | | Investor type|| All | ||
|- | |- | ||
| Tax schemes|| | | Tax schemes|| SEIS/EIS | ||
|- | |- | ||
| Bid/ask spread|| | | Bid/ask spread|| NA | ||
|- | |- | ||
| Commission amount|| | | Commission amount|| Zero | ||
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| Market|| | | Market|| Private<ref name=":0" /> | ||
|} | |} | ||
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* The mission of the company is to help make more money for everyone (and not just the wealthy!).<ref name=":1" /> | * The mission of the company is to help make more money for everyone (and not just the wealthy!).<ref name=":1" /> | ||
*The company is led by the former principal investment analyst of one of the world's wealthiest persons. | *The company is led by the former principal investment analyst of one of the world's wealthiest persons. | ||
*The company’s flagship product is targeted towards Active Investors, who are a group of people that are willing and able to be actively involved in the process of finding suitable investments. The product is an investment research platform. What makes the platform unique is that the research is produced open collaboratively. Evidence suggests that open collaborative investment research will, in time, result in Active Investors making better investment decisions, and, ultimately, more money. | *The company’s flagship product is targeted towards Active Investors, who are a group of people that are willing and able to be actively involved in the process of finding suitable investments. The product is an investment research platform. What makes the platform unique is that the research on it is produced open collaboratively. Evidence suggests that open collaborative investment research will, in time, result in Active Investors making better investment decisions, and, ultimately, more money. | ||
*To date, the Stockhub platform covers 375 investments<ref name=":2" />, and is growing at a rate of seven investments a day<ref>The Stockhub platform was created on 1st March 2022, and the date of the calculation is 25th April 2022, so the platform has been live for 56 days. 375 investments divided by 56 days equates to 7 investments per day.</ref>. | *To date, the Stockhub platform covers 375 investments<ref name=":2" />, and is growing at a rate of seven investments a day<ref>The Stockhub platform was created on 1st March 2022, and the date of the calculation is 25th April 2022, so the platform has been live for 56 days. 375 investments divided by 56 days equates to 7 investments per day.</ref>. | ||
*The Stockhub company estimates that the expected return of an investment in the company over the next five years is 55x<ref>The calculation of the investment return figure can be found in the 'Valuation' section of this report.</ref>. In other words, an £1,000 investment in the company is expected to return £55,000 in five years time. | *The Stockhub company estimates that the expected return of an investment in the company over the next five years is 55x<ref>The calculation of the investment return figure can be found in the 'Valuation' section of this report.</ref>. In other words, an £1,000 investment in the company is expected to return £55,000 in five years time. | ||
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====What makes the flagship product unique?==== | ====What makes the flagship product unique?==== | ||
What makes the platform unique is that the research is produced open collaboratively. Evidence suggests that open collaborative investment research will, in time, result in Active Investors making better investment decisions, and, ultimately, more money. | What makes the platform unique is that the research is produced open collaboratively. Evidence suggests that open collaborative investment research will, in time, result in free-to-access, high-quality research on the largest number of investments.<ref name=":4">http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.706.5770&rep=rep1&type=pdf</ref> In other words, it will result in the democratisation of investment research, in turn resulting in Active Investors making better investment decisions, and, ultimately, more money. | ||
[[File:Stockhub report example.png|centre|400px]] | [[File:Stockhub report example.png|centre|400px]] | ||
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| Cost of goods sold margin (%) | | Cost of goods sold margin (%) | ||
|20% | |20% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7">http://people.stern.nyu.edu/adamodar/pdfiles/papers/younggrowth.pdf</ref>, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7">http://people.stern.nyu.edu/adamodar/pdfiles/papers/younggrowth.pdf</ref>, and the margin for its peers was 20%. | ||
|- | |- | ||
|Selling, General and Administrative expenses margin (%) | |Selling, General and Administrative expenses margin (%) | ||
|80% | |80% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers was 80%. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
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|Depreciation rate (%) | |Depreciation rate (%) | ||
|10% | |10% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers was 10%. | ||
|- | |- | ||
|Fixed capital margin (%) | |Fixed capital margin (%) | ||
|25% | |25% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 1)<ref name=":7" />, and the margin for its peers was 25%. | ||
|- | |- | ||
|Change in working capital (£000) | |Change in working capital (£000) | ||
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| Cost of goods sold margin (%) | | Cost of goods sold margin (%) | ||
|20% | |20% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers was 20%. | ||
|- | |- | ||
|Selling, General and Administrative expenses margin (%) | |Selling, General and Administrative expenses margin (%) | ||
|60% | |60% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers was 60%. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
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|Depreciation rate (%) | |Depreciation rate (%) | ||
|10% | |10% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers was 10%. | ||
|- | |- | ||
|Fixed capital margin (%) | |Fixed capital margin (%) | ||
|25% | |25% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 2)<ref name=":7" />, and the margin for its peers was 25%. | ||
|- | |- | ||
|Change in working capital (£000) | |Change in working capital (£000) | ||
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| Cost of goods sold margin (%) | | Cost of goods sold margin (%) | ||
|20% | |20% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers was 20%. | ||
|- | |- | ||
|Selling, General and Administrative expenses margin (%) | |Selling, General and Administrative expenses margin (%) | ||
|40% | |40% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers was 40%. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
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|Depreciation rate (%) | |Depreciation rate (%) | ||
|10% | |10% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers was 10%. | ||
|- | |- | ||
|Fixed capital margin (%) | |Fixed capital margin (%) | ||
|25% | |25% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 3)<ref name=":7" />, and the margin for its peers was 25%. | ||
|- | |- | ||
|Change in working capital (£000) | |Change in working capital (£000) | ||
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|Cost of goods sold margin (%) | |Cost of goods sold margin (%) | ||
|20% | |20% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers was 20%. | ||
|- | |- | ||
|Selling, General and Administrative expenses margin (%) | |Selling, General and Administrative expenses margin (%) | ||
|40% | |40% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers was 40%. | ||
|- | |- | ||
|Tax rate (%) | |Tax rate (%) | ||
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|Depreciation rate (%) | |Depreciation rate (%) | ||
|10% | |10% | ||
|Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers | |Research suggests that it's best to use a similar margin rate as the one used by peers that are in the same growth stage (i.e. growth stage 4)<ref name=":7" />, and the margin for its peers was 10%. | ||
|- | |- | ||
|Fixed capital margin (%) | |Fixed capital margin (%) | ||
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#By comparing the investment to other similar investments (i.e. relative valuation). | #By comparing the investment to other similar investments (i.e. relative valuation). | ||
Research suggests that | Research suggests that the discounted cash flow valuation approach is more accurate<ref name=":5">Demirakos et al., 2010; Gleason et al., 2013</ref>, so that's the approach that Stockhub suggests to use here; nevertheless, for completeness purposes, separately, the valuation of the company is also estimated using the using the relative valuation approach (the valuation based on the relative approach can be found in the appendix of this report). | ||
|- | |- | ||
|Which financial forecasts to use? | |Which financial forecasts to use? | ||
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|10% | |10% | ||
|There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital. | |There are two key risk parameters for a firm that need to be estimated: its cost of equity and its cost of debt. A key way to estimate the cost of equity by looking at the beta (or betas) of the company in question, the cost of debt from a measure of default risk (an actual or synthetic rating) and apply the market value weights for debt and equity to come up with the cost of capital. | ||
|- | |- | ||
|Probability of success (%) | |Probability of success (%) | ||
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|Which time period do you want to use to estimate the expected return? | |Which time period do you want to use to estimate the expected return? | ||
|Between now and five years time | |Between now and five years time | ||
| | |Stockhub suggests that to account for general market cyclicity, it's best to estimate the expected return of the company between now and five years time. | ||
|} | |} | ||
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Note: five years after incorporation (i.e. April 2018), Robinhood’s valuation was $5.6 billion, and it was trading on a growth-adjusted EV/sales ratio of 43x. | Note: five years after incorporation (i.e. April 2018), Robinhood’s valuation was $5.6 billion, and it was trading on a growth-adjusted EV/sales ratio of 43x. | ||
===Economic links to cash flow patterns === | ===Economic links to cash flow patterns === | ||
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[[Category:Equities]] | [[Category:Equities]] | ||
[[Category:United Kingdom]] | [[Category:United Kingdom]] | ||