Wipo schreef op 29 mei 2015 00:17:
TomTom's Lofty Valuation Is More Than Justified Following Huge Opportunities In Telematics And Fitness
May 28, 2015 3:51 PM ET | 3 comments | About: Tomtom NV (TMOAF)
Disclosure: The author is long AAPL, GRMN. (More...)
Summary
TomTom may be overlooked by investors because of its pricey valuation.
Demand for data-related solutions provide a big opportunity for TomTom's telematics business.
Strong fitness sales are likely to compensate for declining car PND sales.
TomTom is a good long-term investment despite its lofty valuation and identified risks.
In my search for underestimated stocks, I found Dutch navigation and location-services provider TomTom NV (OTCPK:TMOAF). Many investors might overlook this stock, because it trades at 50 times this year's expected earnings per share. Further, the negative outlook regarding the development of the car PND market may turn investors away. However, I find that TomTom's business model provides two significant opportunities to grow revenue and improve earnings per share at a high pace in the future. In this article, I will discuss TomTom's four business segments and discuss the opportunities and threats towards the company's business model. I find that TomTom is a good long-term investment even considering that the company trades at 50 times earnings.