Railway Metrics and Dynamics AB publishes analysis

Railway Metrics and Dynamics AB today publishes an analysis commissioned by TradeVenue AB. TradeVenue’s DCF valuation is SEK 9.1 per share and SEK 3.5 per share depending on two different scenarios.

TradeVenue’s valuation of Railway Metrics and Dynamics largely depends on future earnings development. TradeVenue has used a discounted cash flow analysis with a return on capital employed (WACC) of 14% to arrive at a valuation range of SEK 3.5-9.1 per share.

The valuation uses the same long-term assumptions for both the optimistic and pessimistic scenarios. TradeVenue has also accounted for the uncertainty in the free cash flow forecast in the return requirement by applying a small company premium of 3% and an additional risk premium of 3%.

Given the number of contracts RMD expects to sign in 2023, TradeVenue believes that a much fairer valuation, in line with the above figures, may already be evident this year.

The analysis has been produced by TradeVenue AB on behalf of Railway Metrics and Dynamics AB and can be downloaded in full here.