Summary
Voyager Digital is a mobile-based cryptocurrency platform that has shown exemplary growth within the last 2 years.
The company has increased its funded accounts and revenue over 23 times while its assets under management has grown by almost 30 times.
Voyager is proactively partnering up with market leaders for a diversified presence in multiple areas of the industry.
At $13, the VYGVF shares are underpriced and offer a sweet gateway to investors looking for a long position in the crypto industry.
da-kuk/E+ via Getty Images Thesis
Voyager Digital Ltd. ( OTCQX:VYGVF ) is an incredibly fast-growing mobile-based crypto exchange platform that grew its revenue almost 41 times within the previous 52-weeks as of September. The company is currently a loss-maker, but that’s subject to the fact that Voyager is choosing to fuel its growth through strategic user acquisition and growth investments. Subsequently, Voyager’s funded accounts have grown over 23 times, crossing a million funded accounts since the start of 2021. The company has furthered its rapid expansion through the acquisition of Coinify in August, the release announcement of the first of its kind crypto-based debit MasterCard in November, and a partnership with CoinLedger in December 2021.
With a share price of about $13, the stock is trading far below its fair value pertaining to its promising expected earnings, rapid growth, and strategic moves. This presents an opportunity for potential investors to buy into the stock and just wait for the market correction to kick in. Company Overview
Voyager furnishes a mobile-based exchange platform for investing, earning, and securing multiple types of cryptocurrencies. The company started 2021 with 43,000 funded accounts and $240 million in Assets Under Management (AUM), which have now transformed into over 1 million funded accounts and almost $7 billion AUM. Voyager is currently engaged in multiple marketing maneuvers, especially in the form of loyalty and rewards programs, to increase its popularity and further its user base.
The company’s stock started trading on the Canadian Securities Exchange (CNX) at $0.95 in 2019 and qualified to trade on the OTCQX in July 2021. The company sports a share price of almost $13 right now, with a market cap of about $2 billion. Valuation
Before explaining the strategic endeavors of Voyager that are directed towards an aggressively growing market, I want to emphasize that the company’s current share price of almost $13 is undervalued. This is a good opportunity for investors to get in early into a crypto exchange stock for the long play.
I will be using the Discounted Cash Flow (DCF) model as the company is heavily investing in the future, and this model allows us to gain an insight into the company’s projected inflows to ascertain whether these investments are likely to pay off.
The company is expected to post a net profit in the fiscal year 2022 with an expected revenue amounting to about $531 million and Free Cash Flow (FCF) of negative $112 million . The model employs very conservative estimates of 20% growth per annum, slowing down by 40% each year. Even so, the model stipulates a share price of over $37, which means the shares are currently undervalued by over 65%. Source: Author’s Calculations Growth and Expansion
Voyager has multiple growth initiatives underway that are essential for its competitive stride. As the company’s CEO remarked in the earnings call, “We intend to be an industry leader, and investing in the future is key as our strategy is bearing fruit. This industry is highly competitive, and only the biggest and best capitalized are likely to survive. Our capital rates, strategic alliance, and market expansion initiatives are critical to our future success as we are in this for the long term. We intend to be one of the few participants in the top tier as the crypto industry emerges from its infancy.” Coinify Acquisition
Accordingly, in August, the company acquired Coinify to establish an “effective gateway to the crypto payment industry.” Through the acquisition, Voyager is able to offer crypto payment options to its customers for online and in retail purchases internationally. One of the strategic ways that the company used this acquisition is by integrating its VGX Token into Coinify’s platform, essentially escalating the token’s usability as a payment option to over 150 countries. This deal has also given Voyager a major push in the business-to-business (B2B) arena as Coinify is integrated with over 30,000 merchants worldwide . Synergy with CoinLedger
Cryptocurrencies, by nature, are particularly tricky to track for tax purposes due to their fluctuating […]
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