Repricing IAC to 7% (sales-to-mkt cap) would give them a $41.8B mkt cap (207% increase). For its peers, on average, their revenues represent 7% of their market cap. A Bullish Valuation:įor a business whose valuation depends on sales & growth, IAC's revenues currently represent 21% of its market cap.
The intrinsic value (sum) of all of IAC's holdings today, including cash, is approximately $18.11B. We mention this (above) only to articulate the fact that IAC is still trying to use its expertise in creating shareholder value, whether the company is under IAC's umbrella or trading publicly. In nearly every past spin-off, IAC has strategically placed individuals from its corporate management team onto the board of directors of these companies.Īs of June 2021, 5 of Angi's 11 board members are either existing or former IAC execs, 4 out of Match's 10 board members are within the same capacity, and most recently 5 out of Vimeo's 11 board members also are either currently or were previously affiliated with IAC's management team. The end-game for IAC is to spin off most of its businesses, however, without relinquishing control of the underlying company. These are two businesses that will greatly benefit as the world returns to normalcy and approaches herd immunity. IAC's ownership of Angi and its stake in MGM Resorts are two examples of names that have experienced massive headwinds since Covid-19 / "shelter in place", having wet-blanketed their previously strong YoY growth rates. Some of IAC's successful spin-offs over the yearsĪmong IAC's current assets, we see several diamonds in the rough. Vimeo and Match are only two names among many others that IAC's management team has acquired, developed, and successfully spun off at much larger valuations. Match has since redefined how many people meet and fall in love, having built an empire in the dating industry with over 10 million members and over 45 subsidiary businesses (e.g. What cost IAC $50 million at the time of its acquisition was spun off last summer at a valuation of $30 billion. In 1999, IAC bought, an obscure dating site with fewer than 300k users. Today, Vimeo is a leading contender in the online audio-video space with 112 million daily average users and growing. Vimeo is a product of that, having undergone many changes, developments, enhancements, and strategic shifts since its acquisition in 2006.
While Vimeo was a blockbuster name with plenty of headline press, we have found that there are several "unsung heroes" that have been overlooked by the market, while living in the shadows of Match and Vimeo these past two years.īarry Diller has made a career in buying broken toys and fixing them. We, however, disagree with Fuller's change in sentiment and believe IAC's remaining portfolio of assets warrant a far greater value than what its current market cap represents.
IAC is a digital media and internet holding company that is home to over 150 brands.īTIG's Jake Fuller, a respected industry analyst who covers IAC, recently stated in a downgrade from buy to neutral that its remaining assets are "reasonably reflecting the company's portfolio" and that IAC "is at the beginning of a rebuild cycle" - any excess returns could be years out. *This article was written by Euphoric Investment authors Aayra Aamer, Rohan George, Rinnah Sanders, and Humna Sheikh Background & Investment Thesis
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