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Investing.com - Canaccord Genuity initiated coverage on Boku Inc (LON:BOKU) with a Buy rating and set a price target of GBP2.71, highlighting the payment company’s significant discount to global payment peers.
The research firm noted that Boku trades at a substantial discount despite the company’s guidance for over 20% medium-term revenue growth and expanding EBITDA margins, which are expected to increase 100-200 basis points annually for fiscal year 2026.
Canaccord Genuity pointed to Boku’s strategic positioning in the fast-growing LPM market, combined with its growth profile and current 5.6x FY25E EV/Sales multiple, suggesting these factors make the company potentially vulnerable to acquisition bids in the highly acquisitive payment sector.
The firm forecasts Boku’s EV/Sales multiple to fall to 3.3x on a two-year view when including merchant cash for enterprise value calculations, further enhancing the investment case.
The GBP2.71 price target is based on 7x FY26E EV/Sales or a 4.5% FY26E free cash flow yield, according to Canaccord Genuity’s analysis.
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