For more ideas visit our website: overlookedalpha.com.
These are my personal opinions, not financial advice and I hold no position in this stock.
Last week, Opera stock gained 13% after announcing a $0.80 per share special dividend.
In theory, this makes no sense since the dividend amount will be adjusted out of the share price when the stock goes ex-dividend.
But in this case, there is some logic.
First, Opera is growing nicely, with expected revenue growth of 29% this year. That makes the shares look good value at the 10 times multiple.
Second, investors have long been concerned about the company’s board and its variable interest entity structure.
But governance is starting to look better and the company is now returning excess cash to shareholders via the special dividend.
The Opera browser isn’t a threat to existing stalwarts like Chrome and Safari. But even so, there should be good demand for a niche, independent web browser and Opera’s recent financials are improving, both in terms of overall growth and margins..
The company is still small and the earnings multiple could easily expand therefore I give the stock a cautious bullish rating.
#oprastock #investing #stocks #stockstobuy #overlookedalpha
These are my personal opinions, not financial advice and I hold no position in this stock.
Last week, Opera stock gained 13% after announcing a $0.80 per share special dividend.
In theory, this makes no sense since the dividend amount will be adjusted out of the share price when the stock goes ex-dividend.
But in this case, there is some logic.
First, Opera is growing nicely, with expected revenue growth of 29% this year. That makes the shares look good value at the 10 times multiple.
Second, investors have long been concerned about the company’s board and its variable interest entity structure.
But governance is starting to look better and the company is now returning excess cash to shareholders via the special dividend.
The Opera browser isn’t a threat to existing stalwarts like Chrome and Safari. But even so, there should be good demand for a niche, independent web browser and Opera’s recent financials are improving, both in terms of overall growth and margins..
The company is still small and the earnings multiple could easily expand therefore I give the stock a cautious bullish rating.
#oprastock #investing #stocks #stockstobuy #overlookedalpha
Category
🗞
NewsTranscript
00:00 Should you buy Opera Limited? Tick the symbol O-P-R-A.
00:03 Microcap's stock, Opera Limited, developed the Opera web browser which is advertised as being
00:09 faster, smarter and safer than alternatives. It's got a built-in VPN, ad-blocking technology and it
00:15 costs around $4 a month. The company also makes money from a handful of other digital products.
00:21 With $200 million in cash and little debt, Opera's enterprise value is around $600 million.
00:26 Meanwhile, revenue over the last 12 months was $307 million and adjusted EBITDA was $62.5 million
00:33 at an EBITDA margin of 20%. That means the stock is valued at roughly 2x revenue or 10x EBITDA.
00:40 Last week, Opera's stock gained 13% after announcing a special dividend. In theory,
00:45 this makes no sense since the dividend amount will be adjusted out of the share price when
00:49 the stock goes ex-dividend. But in this case, there is some logic. First, Opera is growing
00:55 nicely with an expected revenue growth of 29% this year. That makes the shares look good value
01:01 at the 10x multiple. Second, investors have long been concerned about the company's board
01:06 and its variable interest entity structure. But governance is starting to look better and
01:11 the company is now returning excess cash to shareholders via the special dividend.
01:16 The Opera web browser isn't a threat to existing stalwarts like Chrome and Safari,
01:21 but even so there should be good demand for a niche independent web browser
01:25 and Opera's recent financials are improving both in terms of growth and margins.
01:30 The company is still small and the earnings multiple could easily expand from here.
01:35 Therefore, I give the stock a cautious bullish rating. But these are my personal opinions,
01:40 not financial advice and I hold no position in this stock. For more detailed investing
01:45 ideas make sure to visit our website overlookedalpha.com