Q: TVK has been on quite a run for the past year or so including a large bump after it's most recent M&A announcement.
Do you think investors should wait for a pull back or continue to consolidate a position and if so, what is a good point to continue buying?
I've missed the boat on HPS.A many times by waiting for the perfect moment so I feel TVK may be on a similar trajectory albeit at lower rates of growth most likely.
Thoughts on TVK and entry points etc?
Do you think investors should wait for a pull back or continue to consolidate a position and if so, what is a good point to continue buying?
I've missed the boat on HPS.A many times by waiting for the perfect moment so I feel TVK may be on a similar trajectory albeit at lower rates of growth most likely.
Thoughts on TVK and entry points etc?
5i Research Answer:
The strength is a bit surprising considering financial terms were not disclosed on the acquisition. TVK is trading at 10.4x EV/EBITDA, the higher end of multiple averages in the last few years ranging from 6.3x to 10.4x, that said, fundamentally, it is not too expensive given the track record of capital allocation, and we are okay to buy some here (perhaps a quarter position) and average into the position over time. We would add more aggressively to the position if it drops below $60. Momentum is very strong but it is not likely to be a straight up move and some consolidation is to be expected.