InnovaDerma to gain from Amazon leverage says broker

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InnovaDerma PLC (LSE:IDP, FRA:7W6) has given more evidence of the progress being made under new chief executive Blake Hughes, says finnCap, which has kept its target price unchanged at 90p.


Sales directly through Amazon, confirmed today, should see it benefit from the leverage afforded by the distribution network, particularly in the US.


A partnership with Neon Management, in late-stage negotiations. should also enable the beauty products group to tap into new demographics that should benefit its core Skinny Tan and Charles + Lee brands and improve margins.


“We leave target price unchanged at 90p, based on EV/Sales multiples and supported by per group comparisons,” said the house broker.


InnovaDerma regroups around core brands and e-commerce


Revenues in 2021 are expected to be no less than GBP10.2mln with adjusted losses of GBP1.5mln.


“At our target price of 90p the stock would trade on a 2022 EV/sales multiple of c.1.9x (times), implying an enterprise value of c.GBP22mln, and still at a discount to suggested peers trading on a median EV/sales multiple of 2.5x.”



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