11. May 2021 | 13:00 CET
Aspermont, ProSiebenSat.1 Media, Alibaba: Investing in the Power of Media
Media companies were long considered loss-making. The reason: Back then, media groups were primarily analog. But digitization is creating enormous opportunities. Content can be played out on different platforms and processes can be optimized. As a result, costs can be reduced, and companies can even initiate new business. We will outline how this works using the three companies below as examples.
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ISIN: ASPERMONT , DE000PSM7770 , US01609W1027
Aspermont: Positive cash flows, great potential
The Australian Company Aspermont stands for tradition and modernity. With the Mining Journal and Mining Magazine, Aspermont offers the mining industry two trade publications that have been published without interruption for more than one hundred years. But Aspermont has much more to offer than a magazine that only geologists and other mining nerds understand. The Company has long been a global B2B service provider that has built on the success of its publications. Aspermont now sells about 95% of its products digitally. These include virtual events such as webinars, the provision of news or data, and eLearning-related offerings.
Since Aspermont itself has collected more than 7 million selected contacts in management positions worldwide, there is always great imagination when the Australians develop new products. After all, existing contacts are easier to use, and Aspermont now also has an excellent reputation. Aspermont's reputation is also reflected in the figures: In the six months ending in March, Aspermont increased its cash revenues from subscriptions by 22% to more than AUD 4 million compared with the same period last year. The virtual events and exhibitions business, which the Company only announced in October, also performed well in its first five months, generating more than AUD 1 million in revenues. As Aspermont has solid and growing cash flows and plans to move into more businesses in the medium term, the stock could be attractive. The market capitalization is only around EUR 42 million.
ProSieben.Sat.1: What does the future hold?
ProSiebenSat.1 seized the opportunities of new business models in the course of digitization even before Aspermont and has, therefore, long been a billion-dollar Company. While this puts the growth opportunities for shareholders into perspective, ProSiebenSat.1's balance sheet also contains a surprise. The Company, which at first glance looks like a merger of TV stations, is a diversified media company.
ProSieben.Sat.1 has stakes in numerous dating platforms, such as Lovoo and Parship. Especially during the pandemic, flirting enthusiasts shifted their activities from clubs and bars to the sofa at home, where they diligently made contacts. Since flirting online is a lot more convenient when users take out subscriptions, the money is rolling in for ProSiebenSat.1. The Company even has in mind to list its dating activities separately on the stock market. The share has already gained around 100% on a one-year horizon and is no longer cheap. However, ProSiebenSat.1 proves that digital media companies have advantages when new projects complement the existing business. Investors should be curious to see what the Company will offer in the future.
Alibaba: Long-term chances are good
The future is also bright for Alibaba. Having started as an Amazon clone from China, today, the Company represents much more than that. Its activities range from traditional online retailing to cloud services, digital media and entertainment. Although Alibaba founder Jack Ma has received a few shots across the bow from Beijing in recent months, Alibaba's high flight is likely to continue - the Chinese Company is too well positioned in the world's most promising market. The quarterly figures, which are always good for Alibaba, also prove this.
Although there is still no good news about Alibaba's fintech investment Ant Group - the Company is restructuring itself month by month - investors have to endure this uncertainty. Over a three-month period, the Company has lost around 15%. If the value comes under further pressure in the short term, there is a threat of a further sell-off. In the long term, Alibaba remains promising, but the stock stands for continuous development rather than giant leaps. Investors looking for dynamic stocks from the media sector should look at the extremely solid but still modest small-cap Aspermont.