Sonim Technologies: Strong Revenue Growth
Reporting 129% revenue growth and growing EBITDA, Sonim Technologies (SONM) should attract both growth and value investors. Taking into account the company's financial debt and the ratio of 10x-12x EBITDA, Sonim should have a minimum enterprise value of $100 million. Using a multiple of 2x forward revenue, growth investors could expect a total enterprise value of $340 million.
1. With ratios of 2x forward revenue and 10x-12x EBITDA, the market should value Sonim’s enterprise at $100-340 million. 2. Sonim Technologies expects to use the proceeds from the IPO to finance its working capital and increase sales and R&D among other purposes. Market participants may not appreciate that Sonim Technologies expects to use some of the proceeds from the IPO to pay part of its debt. 3. FCF increased from -$9 million in 2017 to $3 million in 2018.