Summarized below is an estimate of the relative valuations of some of the major hosting companies as of March 9, 2009.
Annualized Enterprise
Company Revs ($ mil) Value/Revs
United Internet $ 2,058 1.1 x
Savvis $ 890 1.0 x
Rackspace $ 573 1.6 x
Dada $ 226 0.7 x
Navisite $ 151 0.9 x
Web.Com $ 116 0.5 x
Peer 1 $ 95 1.0 x
Group iWeb $ 15 1.8 x
As always, please feel free to contact us if you have any comments, or questions.
Cheval Capital, Inc.
Notes:
Enterprise Value formulas: Please see this post for how we calculate Enterprise Value.
Multiple of Revenue: The reason that we use a multiple of revenue to compare these companies is that they all have very different capital and operating structures and compete in different parts of the hosting business. While not a great way to compare companies, we believe that for high level comparisons it is the most straightforward.
Source of the data: All data was taken from public financial statements for the periods ended September 30, 2008 or December 31, 2008.
Disclaimer: This post is for general information purposes and is not meant to be taken as financial advice, a recommendation to buy or sell the stocks mentioned above, a comprehensive discussion of valuation or how to do the calculations discussed. Please be sure to consult your financial advisors when valuing your company, considering the sale of your business or making other financial decisions.