- migme Limited

MIG
GME LIM
MITED
Resea
arch Note
PRIM
MED TO LE
EVERAGE OFF ITS PLATFOR
RM GROWT
TH
Investment Highllights


18 November 22015
migme Limited
d (MIG) has been rapidly in
ncreasing its
s Monthly Acttive
Us
ser (MAU) an
nd verified arttist base for its digital med
dia and socia
al
ne
etworking pla
atform targete
ed at the Sou
uth East Asia market. MIG is
cu
urrent focuse
ed on increas
sing its MAU base
b
and sub
bsequently
co
onverting tho
ose users to Monthly
M
Activ
ve Paying Us ers (MAPU) via
v
op
ptimisation of its platform
m, increased content
c
and fu
further artist
interactions fa
acilitating use
er micro-trans
sactions. The
e MIG platform
m is
an
n amalgamatiion of service
es offered by other social networks an
nd
ha
as been custo
omised to foc
cus on, and cater
c
to, the S
South East As
sian
market, particu
ular India, Ind
donesia and the
t Philippine
es. We believ
ve the
pportunity in this market is
i substantial, given rapid
d internet
op
pe
enetration fac
cilitating the rise of a large total addres
ssable marke
et of
c4
450m people.. MIG is in a promising
p
position to leve
erage off this
MAPUs
large target ma
arket and thu
us increase its
s MAUs and M
We remain hig
ghly positive on the MIG s
story and
significantly. W
maintain our S
Speculative Buy
B rating with a target priice of $1.90/s
sh.
Arrtists/Celebrity Engageme
ent correlated
d to MAUs: W
We see potential
large upside in MIG attracting
g addition artis
sts (more than
n 490 as at 30
eptember 2015) and, more importantly, household nam
me celebrities from
Se
the respective target countrie
es. This may cause a transittion of followers
MIG platform frrom other social media platfforms such as
s
(users) to the M
Fa
acebook and T
Twitter, where
e certain artists
s and celebritiies have a larg
ge
fan base but little interaction or
o monetisatio
on.
12mth Rating
A$
A$
%
0.93
1.90
105.7
RIC:
R MIG.AX
Shares
S
o/s
Free
F
Float
Market
M
Cap.
Net
N Debt (Cashh)
Net
N Debt/Equityy
3m
3 Av. D. T’oveer
52wk
5
High/Low
w
2yr
2 adj. beta
m
%
A$m
A
A$m
A
%
A$m
A
A$
BBG: MIG
M AU
273.3
80.0
252.8
(10.1)
na
0.15
1..30/0.37
1.66
Valuation:
V
Methodology
M
Value
V
per sharee

Growing user b
base but und
dervalued com
mpared to intternational pe
eers:
MIG has experienced 30% qu
uarter-on-quarrter user grow
wth, with curren
nt
us
ser numbers sstanding at ove
er 24m as at 30
3 Septemberr 2015. We expect
us
ser numbers to
o continue the
e healthy grow
wth trend. Glob
bal peers are
cu
urrently valued
d at US$37.74
4 per user, whiile MIG tradess at US$8.05 per
p
us
ser. This show
ws the extent to
o which MIG is potentially u
undervalued by the
market; howeve
er a portion of the discount may
m be explaiined by the cu
urrent
w revenue per user of c.$0..50 derived fro
om MIG’s platfform.
low
Valuation
V
acro
oss all metric
cs highlights significant u pside: Using the
DC
CF method we
e have derived
d a 12 month target price off $1.90/sh. Ou
ur
va
aluation is high
hly sensitive to
o MAPU conversion and AR
RPU, highlightting
further upside frrom optimisatiion of these metrics.
m
Using a sales multip
ple of
10
0x, we derive vvalue for MIG of $2.57/sh frrom 2017 onw
ward. Additiona
ally
us
sing the media
an global peerr value per use
er of US$37.74
4, would sugg
gest a
va
alue of $4.73/ssh. All these valuation metrics suggest M IG is trading at
a a
su
ubstantial disccount and shou
uld re-rate upw
ward.
Jon Scholtz
Phone:
P
( +61) 8 922
25 2836
jscholtz@psl.com.au
Disclosure:
D
Seecurities Limited
d acted as Jointt Lead
Manager
M
to the S
Share Placemen
nt that raised $7
7.0m at
$0.67/sh
$
for Migm
me Limited in April
A
2015. It also acted
as
a Lead Manageer to the Share Placement
P
that raised
r
$10.1m
$
at $1.00/s
/sh for Migme Limited in Septem
mber
2015.
2
It was paid
d fees for these services
12 Month
h Share Price
e Performanc
ce
Performance
P
%
Absolute
A
Rel.
R S&P/ASX 3300
RESEAR
RCH NOTE – PAT
TERSONS SECU
URITIES LIMITED
DCF
1.90
A$
Analyst:
A
Email:
E

SPE
EC BUY
Price
P
Target
T
Price
12m Total Retuurn
1mtth
-6.0
0
-4.7
7
3mth
-24.8
-20.3
12mth
176.5
187.4
1
All inform
mation and advice
e is confidential and
a
for the private information of tthe person to who
om it is provided and is provided w
without any respo
onsibility or liabilitty on any
account whatsoever on th
he part of this firm or any member or employee thereoof.
18 November 2015
Migme Limited
COMPANY OVERVIEW
migme Limited (MIG) is a digital media and social networking platform based in Singapore, with offices in
Taiwan, Indonesia, Hong Kong, Malaysia and, most recently, in India. MIG is strongly focussed on the
emerging markets in the Asia Pacific region, and will specifically target Indonesia and India. The migme
platform is the Company’s flagship asset which provides chat, entertainment, microblogging and gaming on a
freemium model that consists of free core components and paid premium value-add extensions.
Figure 1: MIG Offices and targeted markets
Source: migme Limited
The MIG platform allows users an aspirational online presence that is detached from their real life self, which
is in contrast to ones presence on Facebook. The idea is that, in markets such as Indonesia and India with
significant structural and social inequalities, users can create their own identity.
The MIG business model is an amalgamation of services offered currently in China (by Tencent, YY and
Weibo etc) and western social networks (Facebook, Twitter etc), but customised and packaged to service the
Asia Pacific market. The freemium model is a proven concept with consumers in the region, with MIG’s key
differentiating factor being local artists and celebrities who create and share content that, in turn, drives users
to the platform and increases participation and potential monetisation
MIG has made 3 strategic acquisitions which are bolt-ons to the main MIG platform; 1) alivenotdead – a media
and artist community that has a large footprint in Asian media 2) LoveByte – an App targeted at couples to
capture, track and share special moments/occasions. Key synergies are in MIG’s ability to integrate the avatar
creator and virtual gift creator/provider into its core platform. And 3) Sold.sg – an eCommerce pay to bid
platform which provides a path for MIG to monetise physical good (and premium virtual goods) via a Business
to Consumers basis and potentially Consumer to Consumer (similar to Alibaba’s flagship Taoboa platform).
INTERNET PENETRATION & TOTAL ADDRESSABLE MARKET
India currently ranks 3rd in the number of smartphone users and is expected to move ahead of the USA in
th
number by 2018. Indonesia, while currently ranked 7 with 38.3m smartphone users, is expected to see the
uptake of smartphones increase rapidly and propel the country to the 4th largest user globally. We note that,
due to the adoption of cheaper smartphones, the number of handsets in emerging nations could potentially
outstrip the current estimate
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
2
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
Figure 2: Internet Penetration (2000- 2020)
Source: migme Limited
Internet and smartphone penetration is expected to substantially increase in emerging markets with the
development and deployment of low cost (below $200 per unit) smartphones is the Asia Pacific markets.
MIG’s initial focus is on the South East Asia market where internet penetration is currently 15% but is
expected to experience double-digit growth rates over the next few years and forecast to hit 65% by 2020.
Rapid Internet penetration would make South East Asia the largest base of internet users with a forecast
1.5bn people connected by 2020.The current addressable market is in excess of 1bn people in emerging
markets, whilst the current target market is c300m internet users in India, Indonesia and the Philippines,
expected to grow to c443m by the end of 2018.
Figure 3: MIG Addressable Market (2018 forecast)
Source: migme Limited
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
3
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
ARTISTS AND USER BASE
MIG has grown its user base by c30% quarter on quarter from June 2014 to September 2015, where user
numbers increased from 5.0m to 24.0m. The increase in MAUs is due to the revamped platform, increased
advertising and an increase in the number of artists and celebrities on the App. The latter is a key aspect in
acquiring and monetising users, as associated artists use the platform to attract and engage with fans.
Figure 4: MIG Verified Artists and MAU’s
Artists (LHS)
MAU's (RHS)
500.00
25.0
400.00
20.0
300.00
15.0
200.00
10.0
100.00
5.0
0.00
‐
Sep‐14
Dec‐14
Mar‐15
Jun‐15
Sep‐15
Source: migme Limited, Patersons Securities Limited
MIG, being a media social media network, requires the virtual presence and interactions of various local
celebrities/artists to drive consumer engagement. Only a year ago, MIG had just over 30 verified artists and
has since grown its talent pool to over 490 verified artists. Artists and celebrities create and share content (in
conjunction with a dedicated in house MIG team) on the platform to attract and engage with users. Users, in
turn, are encouraged to give artists virtual gifts (hugs, flowers, stickers etc), with most items costing between 1
and 10 US cents. MIG and the artists share in the revenue generated from the purchase of virtual gifts.
The idea of a revenue share is a particularly powerful attraction to artists in South East Asia, as piracy erodes
a substantial portion of their potential incomes. This incentivises the artists to be active on the platform which,
in turn, leads to increased user interactions and increased monetisation which generates artist’s income; and
so the cycle continues and grows.
As Figure 4 highlights, verified artist growth and user growth are highly correlated and we believe the verified
artists on the platform is a key driver in user acquisition. We see potential large upside in MIG attracting
additional artists and, more importantly, household name celebrities from the respective target countries which
may cause a transition of followers (users) to the MIG platform from other social media platforms. This could
occur due to the largely arm’s length and impersonal nature of social media platforms such as Facebook and
Twitter, where certain artists and celebrities have a large fan base but little interaction or monetisation.
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
4
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
PEER COMPARISON
MIG is based on a freemium business model. Freemium means the core components of the service offering is
free, in this case the chat, gaming and microblogging features, but the premium components are charged for.
The premium goods and services include virtual goods; premium avatar play and value add options within the
platforms and games.
Facebook is the only other social media platform to offer a full suite of products and services to its users,
however the impact of the Facebook platform is largely in the developed Western markets. This highlights the
quality of the MIG platform and its ability to potentially corner the large emerging South East Asia market.
Figure 5: MIG Peer offering comparison
Source: migme Limited
The virtual goods range in price with no cap, although the majority of goods cost between 1 and 10 US cents.
Credit on the MIG platform is pre-paid either through traditional channels, such as bank accounts and credit
cards, or through services such as DOKU. The DOKU service seems more appropriate for emerging Asian
economies and allows users to top up credit via an ATM or via vouchers from local stores.
Monetisation has been subdued in prior quarters as only 0.3% of active users used or purchased premium
goods. We expect this number to increase as the payment system is further rolled out, artist interactions
increase and additional premium goods are made available
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
5
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
Figure 6: Social Network Users and Market Cap
Figure 7: US$ per user
Users
Market Cap
(US$m)
Facebook Inc*
2845
301,350.0
Tencent**
US$/user
105.92
2102
184,350.0
87.70
LinkedIn
400
33,365.0
83.41
120.00
Twitter
307
18,500.0
60.26
100.00
Line***
212
8,000.0
37.74
Momo
82
2,510.0
30.61
YY
127
3,200.0
25.20
Weibo
212
3,680.0
17.36
Migme
24
193.2
8.05
US$/user
80.00
60.00
40.00
20.00
0.00
Median
37.74
Implied Valuation
US$
905.66
Implied Valuation
A$
1,293.80
A$/sh
4.73
Implied Valuation
per share
Source: Bloomberg, Patersons Securities Limited
* Facebook, Instagram, WhatsApp (Facebook Inc)
** WeChat, QQ, QZone (Tencent)
*** Estimated Market Cap
When comparing the market cap per user ratio of MIG’s peer group, we note that Facebook (including
Whatsapp and Instagram) and Tencent (Including QQ, Wechat and Qzone) attract the highest dollar amount
per user at US$105.9 and US$87.70 respectively. MIG is well below its peers at US$8.05 per user. Using the
median US$ per user (ex MIG) value of US$37.74, we can derive an implied value for MIG of US$905.66m or
A$1.3bn (A$4.73/sh), which is well above the current market valuation of MIG.
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
6
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
VALUATION
Assumptions
Monthly Active Users (MAU): MIG has seen 30% growth in user numbers quarter-on-quarter (QoQ). We
assume user numbers will increase by 26% for the last remaining quarter of CY15, 15% QoQ in CY16, 15%
for CY17 and 3% from CY18 onward. Thus we expect 30m users by end CY15, 53m users by CY16 and then
stabilising at >60m users by CY17. As most of the early adopters of MIG have been in Indonesia and Nepal,
our MAU assumptions may prove conservative if it were to see wide adoption in the Indian market.
Monthly Paying Users (MAPU): MIG’s conversion of MAUs to paying users has been subdued, largely due
to the lack of payment options given the low level of bank account holders in key markets. MIG has addressed
this issue by introducing a range of new payment providers on its platform including DOKU and Dompetku in
Indonesia, to significantly broaden the payment system facilities for monetisation. Historically, paying users
have been low at c0.3%, while peers have reported conversion rates of 2.5% (tian.ge) to as high as 13% (YY).
We assume MIG can increase its paying user penetration by 0.3% QoQ till end FY16 and 0.7% p.a. from
FY17 onward (capped at 6%) as it refines its payments systems, increases user/artist interactions and has an
increased amount of premium goods and services on offer.
Average Revenue Per User (ARPU): Average spend per user, including mobile plan, in the Asia Pacific
region is the lowest globally at $71 per user a year vs $500 in USA and $230 in China. This is understandable,
given the low level of bank accounts and credit cards (payment options) and the subdued level of internet
penetration. However ARPU growth ex mobile plan is the fastest in both Africa and Asia Pacific due to
consumers finding alternative payment methods and being exposed to an increased number of freemium
services. MIG’s current ARPU is erratic but growing, as we have back calculated a range of $0.27 to $0.70 per
annum over the last 6 quarters, with the most recent quarter (September) being $0.70 annualised. We have
forecast ARPU to start at $0.50 annualised (assumes MAPU of 0.11m and revenue per MAPU of $8.60 per
month) and progressively increase to $2.50 annualised by the end of 2019 (assumes MAPU of 2.1m and
revenue per MAPU of $6.90 per month) as premium services and user interactions increase.
Revenue Share: MIG’s main driver of monetisation is leveraging off content created by its enlisted artists and
celebrities. These local celebrities create and share content in liaison with a dedicated MIG team, such as
images, stories and competitions which drive user interactions. Users are encouraged to send artists virtual
goods (as discussed in monetisation) and revenue is split between MIG and the celebrity. MIG intended to
establish a leader board with the top % of celebrities receiving 50% revenue share, while less productive
artists have a lower revenue share and the lowest % of celebrities receiving no revenue. This staggered
payment system is used to motivate celebrities and artists to post and interact with users. We have assumed a
group revenue share of 40%.
Costs base: Besides revenue share and marketing, MIG’s cost base is mainly fixed. 55% of costs are salaries
and benefits to employees which we have escalated by around 10% per annum. While this is high, we believe
it is prudent given the growing nature of the business and user numbers/artists. We have inflated others costs
at 3% per annum. This leads to a negative EBITDA in CY15, before increasing to an EBITDA margin of 5% in
CY16, rising to a sustained level of 45% by CY20 in our base case.
Discount Rate: Given the variability of our assumptions and forecasting risk, we have used a Weighted
Average Cost of Capital (WACC) of 15.1% by applying a risk free rate of 4%, equity risk premium of 6.5% and
beta of 1.7 times, on an all-equity basis
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
7
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
Valuation
Using the discounted cash flow method at a 15.1% WACC and terminal growth rate of 3.0%, we value MIG at
$520.0m or $1.90/sh, which is a 105% premium to the current share price. We have also outlined our forecast
Sales multiples, using 10.0x Sales as the industry standard, which suggest strong valuation upside in FY17
($2.57/sh) and beyond
Figure 8: MIG Valuation
Valuation
$m
$/sh
504.8
1.85
Unpaid Capital
5.1
0.02
Net cash/(debt)
10.1
0.04
520.0
1.90
2016F
2017F
46.2
68.3
Present value of free cash flows
DCF valuation
WACC
15.1%
Terminal growth
3.0%
Sales ($m)
Sales multiple
10.0x
10.0x
Net Debt (Cash) ($m)
(8.5)
(18.2)
Implied Valuation ($m)
470.6
701.6
Capitalised earnings per share
$1.72
$2.57
Source: Patersons Securities Limited
Our valuation is based on strong growth in MAUs, particularly in 2016, and an increase in the monetisation via
the conversion of MAUs to paying users (MAPU). We have assumed 30m MAUs by end 2015, 50m MAUs end
2016 and then plateauing at >60 MAUs post 2017. This accounts for only 13.5% of the total addressable
market and thus highlights the upside in further user acquisition and increased market share in South East
Asia.
Conversion to MAPU is currently low at a c0.3% conversion of MAUs. The industry monetisation standard is
substantially higher at 6% to 10%. We have forecast MAPU to increase by 0.3% Quarter on Quarter till end
2016 and then 0.7% annually from 2017 onward, capped at the lower end of the monetisation range of 6%.
Again, MIG has potential significant upside from an increase in MAPU conversion. Due to the growth in both
MAU and MAPU conversion, we have assumed MAPUs of 0.6m in 2016, 1.2m in 2017 and 1.6m in 2018.
We have forecast ARPU of $0.50 for 2015, increasing to $2.50 per annum from 2019 onward.
Figure 9: MIG Forecast MAU’s
Figure 10: MIG Forecast Paying users and ARPU
MAUs (LHS)
MAU Growth (RHS)
MAPU (LHS)
ARPU (RHS)
70.00
120%
3.00
3.0
60.00
100%
2.50
2.5
80%
2.00
2.0
60%
1.50
1.5
40%
1.00
1.0
20%
0.50
0.5
0%
0.00
50.00
40.00
30.00
20.00
10.00
0.00
FY14a
H1FY15a
FY15e
FY16e
FY17e
FY18e
FY19e
‐
FY14a
H1FY15a
FY15e
FY16e
FY17e
FY18e
FY19e
Source: Patersons Securities Limited
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
8
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
Figure 11 below highlights our headline forecasts which show a large increase in revenue in 2016 and 2017,
which is based on the increase in the MAU base and MAPU. Both gross margins and EBITDA margins
increase healthily due to the relatively fixed nature of the cost base (ex revenue share), which we do not
expect to increase at the same pace as revenue growth.
Figure 11: MIG Revenue and Cost
FY14a
H1FY15a
FY15e
FY16e
FY17e
FY18e
Revenue
$m
1.95
3.03
11.87
46.21
68.34
111.21
Cost of sales
$m
1.36
1.36
4.20
10.37
10.75
12.18
Revenue Share
$m
0.00
2.43
4.75
18.48
27.34
44.48
Gross Profit
$m
0.59
-0.76
2.92
17.35
30.26
54.55
30.4%
-24.9%
24.6%
37.6%
44.3%
49.0%
Gross Margin
Employee Expense
$m
6.24
4.96
9.92
10.92
12.01
13.21
Operating Expense
$m
3.16
1.93
3.81
3.92
4.04
4.16
EBITDA
$m
-8.81
-7.64
-10.81
2.51
14.21
37.17
-452%
-252%
-91%
5%
21%
33%
EBITDA Margin
Source: Patersons Securities Limited
Sensitivities
We note that our valuation is highly sensitive to the assumptions stated. Below we have shown the sensitivity
to each variable, ceteris paribus, and highlight the extreme valuation sensitivity to movements in MAPU and
ARPU assumptions.
MAU: a 1 % increase in MAU growth translates to a 7.9% change in our valuation
MAPU: a 1% increase in paying user conversion translates to a 13.9% change in our valuation.
ARPU: a $1 increase in ARPU translates to a 19.8% change in our valuation.
Revenue share: a 1% change in revenue share translates to a 2.4% change in our valuation.
Discount Rate: a 1% change in WACC translates to a 12.3% change in our valuation
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
9
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 November 2015
Migme Limited
CORPORATE
As at 30 September 2015, MIG had $10.8m of cash on hand. On 11 September 2015, MIG placed 10,110,000
shares at $1.00 to raise $10.11m. Given a cash burn of c$3.0m per quarter, we expect MIG to have around
$7.1m in cash as at 31 December 2015.
We have forecast MIG to achieve cash flow break even sometime during the second half of CY16, unless MIG
can monetise content sooner or at a greater rate, and/or control costs. We envisage the need to return to
market for further funding in 6 to 9 months.
MIG has 18.0m options outstanding at various exercise prices ($0.20 to $0.70) with the first tranche of these
options expiring on 31 July 2017. We note that all the options are currently in-the-money and thus represent
unpaid capital of $5.1m
RISKS & CATALYSTS
Risks

Technology: MIG may be adversely affected by rapid macro changes in technology that renders its
platform obsolete. MIG is also exposed to issues specific to its platform, such as security and
downtime issues. However we feel the technological risk is rather manageable as MIG seems to
have a capable team to support its platform and should be able to adjust to changes.

Competition: Competition from an increased presence by other social networks such as Facebook
or Tencent could negatively affect MIG’s footprint in emerging Asian markets. However, we feel that
MIG’s first mover advantage and platform specifically customised for the market, has gone some way
to address this concern.

Monetisation: MIG may not be able to reach monetisation figures achieved in China, Japan or South
Korea due to the low level of bank accounts and credit cards in its targeted emerging markets. MIG
has taken steps to address this by partnering with DOKU, a payment service that may be more
appropriate for the market and should increase monetisation.
Catalysts

User Growth: Current user quarter on quarter growth is 30%. MIG may be able to increase its user
growth through further artist interaction, pre-installs on android devices and an increase in marketing
in key markets.

Geographic Expansion: Penetration in India is key to MIG’s growth, we understand that MIG
already has a presence in the country but quicker adoption may allow MIG to focus expansion on
additional markets such as Africa.

Artist/Celebrity Adoption: If the revenue share model proved to be successful for the current
verified artists, we believe additional artists will be drawn to the platform in a hope to attract additional
users and monetise their social interactions. The adoption of new artists may also increase the
number of users and engagement of users on the platform.

Acquisitions: The MIG platform allows the Company to acquire and integrate complimentary
businesses. We see additional gaming and ecommerce acquisitions as the logical step in increasing
monetisation.

Third party developers: MIG has opened its API to allow third party developers to create Apps and
games on the MIG platform, user growth could make this an extremely attractive marketplace for
developers in a similar manner Facebook API’s allowed Zynga to leverage (Farmville, poker etc).
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
10
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.
18 Novem
mber 2015
Migme Limited
RESEAR
RCH NOTE – PAT
TERSONS SECU
URITIES LIMITED
11
All inform
mation and advice
e is confidential and
a
for the private information of tthe person to who
om it is provided and is provided w
without any respo
onsibility or liabilitty on any
account whatsoever on th
he part of this firm or any member or employee thereoof.
18 Novem
mber 2015
Migme Limited
Re
ecommend
dation Histtory
Date
Type
Target PriceSh
hare PriceRecom
mmendation Re
eturn
27 May 15
Research Note
1.87
0.82
SB
29 May 15
H off the Press
Hot
s
1.87
0.85
SB
3..7%
10 Jun 15
H off the Press
Hot
s
1.87
1.05
SB
23
3.5%
1..9%
31 Jul 15
H off the Press
Hot
s
1.87
1.07
SB
02 Sep 15
H off the Press
Hot
s
1.87
1.14
SB
6..5%
15 Oct 15
H off the Press
Hot
s
1.98
0.98
SB
-14
4.0%
Research Note
1.90
0.93
SB
-5
5.1%
18 Nov 15
ce
Current Share Pric
0.93
Sto
ock recommen
ndations: Invesstment ratings are a function of Patersons expe
ectation of total return (forecastt price apprecia
ation plus dividend
yie
eld) within the ne
ext 12 months. The investmentt ratings are Buyy (expected tota
al return of 10%
% or more), Holdd (-10% to +10%
% total return) an
nd
Se
ell (> 10% negattive total return)). In addition we
e have a Specul ative Buy rating
g covering highe
er risk stocks thaat may not be of
o investment gra
ade
due to low markett capitalisation, high debt levels
s, or significant risks in the business model. Inv
vestment ratinggs are determine
ed at the time off
age, or a change
e in target price
e. At other timess the expected total return may fall outside of thhese ranges be
ecause of price
inittiation of covera
mo
ovements and/o
or volatility. Such
h interim deviations from speciffied ranges will be permitted bu
ut will become ssubject to review
w by Research
Ma
anagement. This Document is not
n to be passed on to any third
d party without our prior written
n consent.
RESEAR
RCH NOTE – PAT
TERSONS SECU
URITIES LIMITED
12
All inform
mation and advice
e is confidential and
a
for the private information of tthe person to who
om it is provided and is provided w
without any respo
onsibility or liabilitty on any
account whatsoever on th
he part of this firm or any member or employee thereoof.
18 November 2015
Migme Limited
RESEARCH NOTE – PATERSONS SECURITIES LIMITED
13
All information and advice is confidential and for the private information of the person to whom it is provided and is provided without any responsibility or liability on any
account whatsoever on the part of this firm or any member or employee thereof.