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$LFVN is a personal care company focused on making people feel and look younger through mitochondria-performance improvements and anti-oxidative stress products such as capsules, face and hand creams, energy drinks, supplements.
But are they a good investment. Thread below
But are they a good investment. Thread below
$LFVN âs Revenues have grown by 13% and profits grown by 89% in the last 5 years. This has been helped by expanding into New Zealand, Australia and emerging markets etc.
$LFVN have an amazing balance sheet with a current ratio of 1.89 and a gearing ratio of 1% with no Long-term debt. Also with 20m in cash and cash equivalents (15% of market cap) there is plenty of capital available for expansion.
FCF has grown by 186% in the past 5 years from $5.5m to $15.7m. This is very impressive and we can see that $LFVN have been increasing their share buybacks and have bought and retired 7% of shares in the past 5 years.
If we look at the first 6 months of their 2021 fiscal year. Revenue is down 3% for $LFVN due to covid restricting sales but operating income is up 45%+ and Net profit is up 4% even when you look at the discrepancy in tax expenses.
$LFVN have kept their guidance of $240m in revenue for fiscal 2021 which is a 3% increase and a 5% EPS growth.
$LFVN operate through direct selling using independent distributors which are classed as contractors and not employees. These sellers purchase inventory from $LFVN and then any sales they complete they get a commission on. $LFVN also sell through their website.
Due to COVID-19, $LFVN independent distributors have found it tough to sell especially with face-to-face restrictions. Also $LFVN have not been able to do any large events which they do yearly in their largest markets such as the US and Japan.
$LFVN also had to postpone their expansion into Malaysia and Singapore but have stated that they will be entering the markets this year. $LFVN definitely have the capital to expand and purchase back more shares.
$LFVN P/E ratio is currently lower than in March during the market-wide crash which presents a huge opportunity. They have been many dips in recent times and theyâve rose bavk up to the mid teens every time. $LFVN is currently extremely undervalued.
$LFVN have a $130m market cap with a 5-yr average FCF of $10m which means they are trading at 13x 5-yr FCF. My target is 20 x 5-yr FCF which is $14.09 providing 53.8% upside. I will be purchasing today/ tomorrow. Weekly chart looks perfect for entry, daily is about to reverse.
