DonkeyRepublic Holding A/S, a data driven technology company, provides bike sharing solutions in Europe. The company develops software which enables the rental of bikes. It offers pedal bikes and e-bikes. The company was founded in 2014 and is headquartered in Copenhagen, Denmark.

Denmark

DonkeyRepublic Holding A/S

Financial Services

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

DONKEY.CO reported revenue of DKK 147mn in the last 12 months, up 28% from FY23. At the same time, the dynamics of cash flow, as measured by free cash flow (FCF), were drastically different. EPS fell 67% from FY23 to DKK -0.41.

The stock's performance has been mixed in the past six months, with growth following a decline. There is no clear price trend compared to its global peers from the same sector and industry (as shown above). The stock has outperformed this peer group by 17ppts over past six months and grown 3ppts slower in the past month. This is largely true for peers from the same country and sector. With respect to the stock's valuation against its peers, its overall price performance is 'fair'.

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been -2.3 in the past several years. This ratio implies a fragile shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are minimal. In combination with stringent business standards, shareholder rights are very highly protected.

DONKEY.CO has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity is unstable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. Another factor to consider is the substantial number of days with zero trading volumes, i.e., without any ability to sell a position. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is high. Among the negative credit factors, we point to weak positions in its industry, bleak profitability, negligible return on capital, and inadequate interest coverage. We note resilient historical revenue growth and low margin volatility, among the positive credit factors. 

In highly turbulent market conditions, DONKEY.CO is moderately volatile. In other words, the stock will fall more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be moderate. 

In normal market circumstances, DONKEY.CO is highly volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will change somewhat erratically. The stock's losses on its worst days (less than 1-5% of the time) will range from large to substantial. We would also like to highlight the substantial intraday volatility of the instrument. 

Based on key historical and expected multiples, the stock is fairly valued relative to its peers. Specifically, the stock is undervalued on EV/EBITDA, reasonably priced on P/FC. 

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DonkeyRepublic Holding A/S

DKK 7.55

3

DonkeyRepublic Holding A/S

DKK 7.55

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

DKK 7.55

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