#106: Jeremy Raper; Endor AG

For the full video interview on YouTube, click here.  
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  Overview

Endor AG is a Munich-listed holding company whose sole asset
is Fanatec, the premium provider of racing wheels and other
accessories for sim racing games played on consoles and PCs
Despite being a German-listed small-cap, the company has ~80%
market share in the premium wheel/accessories segment and has
essentially locked up exclusive branding rights for all the major
OEMs and racing organizations (F1/Nascar/WRC) to produce branded
replica racing wheels.   Growth   Endor AG grew 70-80%
last year and has compounded revenues at 40% over the last
10yrs, as iRacing/simulated racing has grown organically in
popularity at very high rates COVID-19 Impact Current growth is
exploding due to COVID-19 and the mainstream recognition sim racing
has garnered with normal sports closed for the last three months.
  The current business is growing 100-200% per annum, so much
so that the company can barely keep up with demand.    
The company has already leaked they are targeting 150-200mm in
revenues at 25-30% EBIT margins in the next couple of years (versus
40mm revenues last year and 80mm this year).   Going Forward
The stock currently trades at ~11x 2021 earnings, and ~2x 2021E
sales, despite a multi-year runway where the business could grow
30% for a very long time.   Fair value on a 'normal' exchange
with English disclosures/investor relations would probably be 4-5x
the current price. Jeremy believes that even on the minor German
exchange, it's hard to see how the stock doesn't double or
triple again.     Staying In Touch With Jeremy Raper

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