Publicly traded new TLD company has a solid market value.
Top Level Domain Holdings, a pure play company focused on new top level domains, has a market cap of around £ 39 million. That’s over $60 million USD.
We’re talking about a company that basically has no revenue. So far it has just been spending on the new TLD process.
As of last February the company had about £ 15 million in cash. A lot of that has surely been spent since then. But to be conservative, let’s assume the market cap net of cash is around £ 24 million. That’s still about $38 million.
This $38 million value is based solely on the potential of its new top level domain business. That includes applying for its own TLDs, helping clients get their TLDs up and running, and partnerships for new TLDs.
That’s a hefty valuation, if you ask me. What it shows is that a lot of people are big believers in the profit opportunity of new TLDs.
Fortunately for TLDH, it doesn’t need all of its bets to pay off. It should have a large enough portfolio to weather a few duds.
What do you think…is Top Level Domain Holdings worth its $60 million market cap?
Jean Guillon says
…surprise coming.
JS says
I’m not knowledgeable in stock investing, but I figured if you compare the PE ratio of some public companies in the domains space, you could come up with a reasonable treshold of what constitutes acceptable earnings or profit for TLDH.
Tucows, Melbourne IT and Web.com (owns Net Sol, register.com) have P/E in the 10-13 range.
Can TLDH earn 5-6 millions in profit per year ? I don’t think they can pull it off based solely on their TLD holdings – as .CO and .XXX showed, a TLD requires massive marketing. Competition is about to get tougher too.
Perhaps the key for TLDH will be it’s consulting business.
Pierre G says
SURPRISE IT ME AGAIN !!!!!!!!!
GUESS WHAT I THINK THIS IS THE BIGGEST SCAM EVER LIKE FACEBOOK THAT IS FALLING TO HELL !
Pierre G says
I mean a new gtld cannot get the country codes tld so it is not brandable….not exportable….the CIRA Man said in less than 3 years half the new gtlds will fail it is a sign…
http://www.itbusiness.ca/it/client/en/home/news.asp?id=67442
Antony Van Couvering says
TLDH is a public company, so I am constrained about how I can talk about valuation. But let me provide some comparables about a subset of TLDH’s portfolio — geographical new gTLDs.
New Zealand’s ccTLD, .co.nz, has 400,000 registrants in a population of 4 million. That’s 10%. Great Britain (.uk) has 10 million names in country of 60 million – 15%. Germany, .de, has 15 million names for a population of 90 million – 18%. You will find that throughout the developed world, ccTLDs have registration that correspond to between 10 – 20% of their populations. These sales have occurred over many years, but the bulk of them have occurred recently.
Now consider some of the new gTLDs in the developed world where governments have given TLDH their stamp of authority. Bavaria – .BAYERN – has a population of about 12.5M. North Rhein Westphalia – .NRW – about 18M. Greater London Area – 14M. Greater Miami – 5.5M. Greater Budapest, about 2M. Total more than 40M people.
We think city and regional TLDs, with government approval, are highly analogous to ccTLDs. With proper execution, a company with a geo-TLD market ought to be able to approach the 10% penetration achieved by ccTLDs within a few years (remember, current ccTLDs have done essentially zero marketing). You do the math.
It’s our view that our current share price and market valuation is more than supported solely by the developed-world geographical gTLDs whose governments have chosen to work with us. In addition, geographical gTLDs are not the only new gTLDs we’re applying for.
I hope that helps.
Antony Van Couvering
CEO, TLDH
John says
What a great short play
Phil Gaucher says
They can justify valuation till the cows (TCX ) come home !! ! That’s right Tucows earned 5 cts Dec 31st , 4 cts March 31st and continues to buy back stock with substantial FREE CASH FLOW. The valuation for TCX IS EXTREMELY LOW BY ANY COMPARISONS.