On Markets & Investing

Exor: still a hugely undervalued compounder [PREMIUM]

21 April 2024

A value trade or a compounder?

Investors often face the trade-off between the quality of the business and the price they have to pay for it. Some prefer quality companies at a slightly higher price; others focus on cheap companies, accepting lower quality.

But in Exor’s case, you can have both—a collection of great businesses at an attractive price.

Exor owns 10-64% stakes in 7 publicly listed companies with a combined market cap of €184bn. The market value of Exor’s holdings in those listed entities is €37bn. Exor has 218.7mn shares outstanding (excluding treasury stock), which means that the listed entities are worth €169 per Exor share.

On top of this, the company owns over a dozen private businesses and investment companies (Lingotto and Exor Ventures) with a combined value of €7.6bn (€35/share).

All in all, Exor’s NAV, based on the latest market prices, independent valuation of private business commissioned by management and its net financial position as of 31 December 2023, comes up at €40.9bn, or €187 per one share. Exor’s shares trade at a 46% discount to NAV.