AlsterResearch Update: The Social Chain - Second chance for investors

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What’s it all about?

After the recent hefty share price decline of above 30% since the peak at c. EUR 60, investors now get the second chance to buy the stock at levels of pre-DSH acquisition times. With combined sales of EUR 620m (2021E), TSC is only valued at a meagre 1.3x EV/sales, which does not reflect a fair price for this fast-growing company (137.1% yoy in 9M) in our point of view. With more than 80 million followers, around 1.8 billion clicks and views per month and a reach of 2.2 billion end customer contacts, the company has enormous potential to place its 30 own brands and the 700 brands acquired by DSH and expand its strategic advantage versus other E-Commerce players and hence constantly outgrow the market. Therefore, estimates and price target remain untouched. We confirm our DCF-based price target of EUR 66.00 and our recommendation remains BUY with an upside potential of 29%.