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On Thursday, H.C. Wainwright reaffirmed its Buy rating for Exodus Movement, Inc. (OTC:EXOD), with a steady price target of $50.00. Trading at $51.36, the stock has delivered an impressive 833% return over the past year, according to InvestingPro data. The firm’s analyst, Kevin Dede, provided insights into the company’s recent activities, particularly its acquisition of Banxa Holdings. Dede highlighted the significance of the acquisition, noting that Banxa, a company they have been following since September 2021, has been instrumental in providing banking access in multiple jurisdictions. This acquisition by Exodus, a wallet and crypto swap technology company, is seen as a strategic move to enhance its offerings in the crypto space.
The deal, valued at $57 million, represents an 80% premium over a previous offer made by 1493819 B.C. Ltd., and is considered a bargain at 0.25x Dede’s FY25 (June) sales estimate for Banxa of A$358.9M. With Banxa insiders owning about 7% of the company’s outstanding shares, the analyst anticipates that the acquisition by Exodus should proceed without hindrance from competing offers. InvestingPro data shows Exodus’s strong financial position, with a current ratio of 8.14 indicating robust liquidity to support the acquisition.
As of the end of the September quarter, Exodus had approximately $70 million in cash reserves. The company is expected to provide details on the benefits of the Banxa acquisition in its year-end report, which is due in the coming weeks. With remarkable revenue growth of 83.7% in the last twelve months, Exodus has demonstrated strong momentum. At that time, H.C. Wainwright plans to review its estimates and price target for Exodus. Until then, the firm maintains its Buy rating and $50 price target based on the company’s expected growth and its step forward from relative obscurity in the market. InvestingPro subscribers can access 15 additional investment tips and comprehensive financial metrics for EXOD.
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