When looking for interesting stocks, I also like to look away from the mainstream. I find the business model of each of the following three companies interesting. All three deserve a closer look in my opinion.
Did you know that eBay Classifieds isn’t even an American company? eBay belongs? The portal was handed over to the Norwegian company in the summer of 2020 Adevintá (WKN: A2PE65) sold. The group is the world’s largest online classifieds group with a presence in 15 countries. In Germany, the company operates mobile.de in addition to eBay classifieds.
By offering platforms where used items can be easily exchanged, Adevinta wants to benefit from the trend towards greater sustainability. That sounds logical to me. I like the growth too. In 2021, total revenue and EBITDA increased by 10%. In the long term, the company wants to increase sales by 15% per year. However, I don’t like that it has made losses in the last two years and that the debt is high due to the 2020 acquisition. It is worth a watch for me.
The current war in Ukraine shows how important good cyber security solutions are. To protect against hacker attacks, there are the most sophisticated software solutions. But they are all useless if, for example, an employee passes on their user data via a phishing email. This is exactly where KnowBe4 (WKN: A3CM1E) comes in. The American company offers cloud-based tools in a subscription model, with the help of which users are regularly trained and tested, for example, to choose strong passwords and not fall for phishing emails.
In 2021, sales increased 41%, number of customers increased 28% to more than 47,000. For the full year, it posted a loss of $12 million, but free cash flow was positive, growing 94 % to $71 million. The market cap is $3 billion and the price-to-market ratio is 12. I like the company’s approach. I’m still not sure how deep the moat is. KnowBe4 argues that it already has millions of users providing data to improve the AI-powered platform and software patents are used. I imagine opening a small position if the price falls further.
Unlike the previous two actions, the action remains Steico (WKN: A0LR93) is clearly up 34% over a one year horizon. The company, founded in 1986 and headquartered in Feldkirchen near Munich, is the world market leader for wood fiber insulation materials. The sustainable products are produced in factories in Poland and France and then used to insulate houses during new construction or renovation.
Well-insulated houses are important for achieving Germany’s ambitious climate protection goals. According to the Federal Environment Agency, the heating sector accounts for more than 50% of final energy consumption in Germany. The current sharp rise in energy prices further increases the appeal of well-insulated homes.
So I find Steico’s story exciting. And the development of recent years is also impressive. Sales and EBIT increased steadily. In 2021, preliminary sales increased by 26% and EBIT by 102%. In 2022, sales are expected to increase by 15% and the EBIT ratio is expected to decrease. However, I fear that the construction boom of recent years could level off. In addition, a major energy-efficient building subsidy in Germany unexpectedly expired in January 2022. Given these uncertainties and because I find it difficult to assess the competition of insulation materials made from other materials, the P/E ratio of around 26 is too high for me.
The article 3 Unknown Stocks Worth Watching Now first appeared in The Motley Fool Germany.
Hendrik Vanheiden does not own any of the shares mentioned. The Motley Fool recommends eBay and the following options: April 2022 short call $62.50 on eBay.
Motley Fool Germany 2022