Sep. 16 at 9:13 PM
$BLKB 17x
$275M CY26 Adj FCF =
$4.7B market cap / 48.2M shares =
$97 per share or ~40% upside to current
$68. What am I missing / what is bear case? Any feedback appreciated - learning the name / have small long.
• CY25 FCF guide of
$190-
$200M depressed by ~
$60M one-time items (see IR presentation & 2Q’25 transcript); management clear in transcript r/ signaling/implying CY26 FCF step-up; based on history, won’t get CY26 guide until 4Q call. 2Q call positive on incremental benefit from cash tax reduction due to tax law change not yet in CY25 guide which gives near-term support to CY25 and further supportive of CY26.
• 3-year average P/LTM FCF of 17x; organic revenue growth has accelerated during this period; for much of 23-24, trading above 19x. Currently trading at 13.5x LTM FCF.
• Management rejected Clearlake bid at
$80/share in April 2024
• Seeking Alpha write-ups have been bearish, but MSD organic rev seems sustainable based on multi-year contracts in place w/ annual price increases.
