Market's view on IWG
Published on April 2024
- Mitsubishi Real Estate’s purchase of the Japanese franchise from TKP is seen as an endorsement of the business model.
- There is skepticism about the viability of a deal going through, with advice against buying at the current high prices as the potential deal is already factored into the price.
- Differentiation between current borrowing and net debt is highlighted, emphasizing a misunderstanding in financial discussions.
- A discussion on the treatment of the company as debt-ridden based on future rents, while not accounting for contracted future revenue and the benefits of a capital-light expansion model.
- Financial updates indicate a net financial debt of £723 million, down by £18 million from the previous quarter, which is considered a positive trend in reducing liabilities.
- Claims of obfuscation by the company using net debt figures instead of total liabilities, with a total debt figure claimed to be over £9 billion.
- Clarification provided about the components of enterprise value; total enterprise value is cited as £7.8 billion.
- The potential sale of a business leg for £1.5 billion is discussed in terms of its impact on enterprise value and market capitalization.
- Positive feedback on the financial research shared, indicating the value of detailed financial insights in stock discussions.
- A quick financial gain reported following market movements, demonstrating active trading success.