Why BBTV Stock Is Poised to Outpace the TSX in 2021!

BBTV Holdings is part of a rapidly expanding market making the undervalued tech stock an enticing bet for 2021 and beyond.

| More on:
Hand arranging wood block stacking as step stair with arrow up.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

If you are looking to invest in stocks that are poised to finish off the year strong, you might want to consider BBTV Holdings (TSX:BBTV). This company went public in October 2020 and is now trading nearly 50% below its record high. In 2020 it achieved revenues of $459 million — an increase of 23.3% compared to the prior fiscal year as a private company.

BBTV is now looking to improve its bottom line, as it recently completed a $66.27 million financing, which adds significant support to the company’s balance sheet. 

BBTV has been making waves in the media industry with unique solutions for creator monetization. The company allows creators to generate additional revenue for their existing content. The TSX company has rapidly grown to serve thousands of creators on its native platform, which now includes fortune 500 clients such as the NBA and Sony Pictures

BBTV works with thousands of creators globally, with approximately 500 clients generating over $100,000 in annual revenue and around 100 creators generating more than $500,000. The company is aiming to leverage its integrated technology platform that gives users the solutions needed to maximize their views and make more money. These include influencers and creators who would otherwise require multiple platforms to access the comprehensive suite of tools that BBTV provides.

BBTV stock is trading at a discount

Creator monetization is a trending topic as hundreds of companies in the private sector are scrambling to grab a piece of the pie. Companies such as Patreon or more recently creator monetization startup Pico have raised massive capital at steep valuations, which shows the lengths investors are willing to cross and enter this “viral” market. 

With a strong balance sheet and massive growth potential, BBTV stock is currently trading at a significant discount. Currently, BBTV is valued at a market cap of $163 million. Formal independent research from sell-side analysts reveals that they expect the firm to increase gross profit by 14% to $41 million in 2021 and by 39% to $57 million in 2022. This reveals that the company is trading close to four to five times on an EV/gross profit basis in comparison to 42 times for market competitors. Analysts have set an average price target of $18.50 — a 133% upside from where it currently trades. 

BBTV will have the support of multiple driving factors, allowing it to continue top-line growth at a steady pace throughout 2021. Firstly, the company is operating in a red-hot market, as nearly 30% of students in the United States are aspiring creators. As this generation shifts into the workforce, BBTV is perfectly poised to capitalize on the massive and fast-growing creator craze. In fact, BBTV is already generating a combined 40 billion views each month across its portfolio of creators. 

The Foolish takeaway

As BBTV continues to grow its “Base Solutions” and its high-margin wing “Plus Solutions,” the company will continue seeing rapid growth in revenue and earnings providing significant upside in the stock. Analysts tracking the stock expect the company to increase sales by 9.1% to $500.9 million in 2021 and by 15.6% to $579 million in 2022. BBTV is also forecast to improve its profit margins, as it’s forecast to post a loss per share of $0.68 in 2022 compared to a loss of $1.05 per share in 2021. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool has no position in any of the stocks mentioned. Fool contributor Aditya Raghunath has no position in any of the stocks mentioned.

More on Tech Stocks

grow money, wealth build
Tech Stocks

How to Create $100,000 by Investing $500/Month

These two TSX stocks will aid you in building wealth of $100,000 over the next 8.5 years.

Read more »

Businessman holding tablet and showing a growing virtual hologram of statistics, graph and chart with arrow up on dark background. Stock market. Business growth, planning and strategy concept
Tech Stocks

This Battered Growth Stock Could Soar Over the Next 3 Months

Docebo (TSX:DCBO)(NASDAQ:DCBO) is a top work-from-anywhere stock that may be in for a sizeable move to the upside in coming…

Read more »

financial freedom sign
Tech Stocks

3 Selloff Stocks That Could Set You Up for Life

Are you hoping to take advantage of the stock market selloff? Here are three stocks that could set you up…

Read more »

question marks written reminders tickets
Tech Stocks

Docebo (TSX:DCBO) Stock Is Still Down 63%: Should You Buy it?

The growth potential of many new tech stocks that joined the TSX during the pandemic may have been exaggerated, and…

Read more »

Plant growing through of trunk of tree stump
Tech Stocks

2 Growth Stocks Investors Should Buy Today

Are you looking for stocks to add to your portfolio? Buy these two growth stocks today!

Read more »

Male IT Specialist Holds Laptop and Discusses Work with Female Server Technician. They're Standing in Data Center, Rack Server Cabinet with Cloud Server Icon and Visualization
Tech Stocks

3 Tech Stocks I am Buying During a Correction

High-growth tech stocks such as Docebo and Shopify should remain part of your buying list right now.

Read more »

exchange-traded funds
Tech Stocks

2 Tech Sector ETFs to Buy for a Recovery

Individual tech stocks might not fit the risk appetite of many conservative investors. Though, gaining exposure to the entire sector…

Read more »

Growing plant shoots on coins
Tech Stocks

3 Growth Stocks Are Back in the Game: Up to 83% Upside to Come!

Buying a basket of diversified growth stocks can accelerate your retirement plan. Alternatively, you can use profits for a nice…

Read more »