Innventure, Inc. (NASDAQ: INV)

Sector: Financial Services Industry: Asset Management CIK: 0002001557
ROIC (Qtr) -161.31
Rev 1y % (Qtr) 68.45
Total Debt (Qtr) 66.00 Mn
Debt/Equity (Qtr) 0.35
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About

Investment thesis

Bull case

  • Tangible assets of 67.11M provide exceptional 86.48x coverage of deferred revenue 776000, showing strong service capability backing.
  • Free cash flow of (87.18M) provides excellent 117.97x coverage of dividends (739000), indicating sustainable shareholder returns.
  • Long-term investments of 31.21M provide solid 1.06x coverage of long-term debt 29.51M, indicating strategic financial planning.
  • R&D investment of 23.81M represents healthy 30.69x of deferred revenue 776000, indicating strong future innovation pipeline.
  • Cash position of 14.06M provides strong 18.12x coverage of deferred revenue 776000, ensuring service delivery capability.

Bear case

  • Operating cash flow of (85.54M) barely covers its investment activities of 2.74M, with a coverage ratio of -31.19, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of 2.74M provide weak support for R&D spending of 23.81M, which is 0.12x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 14.06M provide limited coverage of acquisition spending of 11.36M, which is 1.24x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Operating cash flow of (85.54M) provides insufficient coverage of deferred revenue obligations of 776000, which is -110.23x, raising concerns about future service delivery capabilities.
  • The company's operating cash flow of (85.54M) shows concerning coverage of stock compensation expenses of 39.55M, with a -2.16 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Asset Management
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 BLK BlackRock, Inc. 199.59 Bn 85.40 21.98 15.04 Bn
2 BN BROOKFIELD Corp /ON/ 103.94 Bn 31.52 5.64 262.97 Bn
3 AMP Ameriprise Financial Inc 88.69 Bn 55.02 7.20 5.89 Bn
4 BX Blackstone Inc. 88.51 Bn 49.39 10.93 12.89 Bn
5 KKR KKR & Co. Inc. 55.86 Bn 28.33 13.23 53.12 Bn
6 STT State Street Corp 46.52 Bn 21.77 3.91 34.72 Bn
7 NTRS Northern Trust Corp 34.14 Bn 33.31 6.71 15.64 Bn
8 RJF Raymond James Financial Inc 32.89 Bn 37.63 4.14 5.10 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.33 0.94
EV to Cash from Ops. EV/CFO -2.14 41.10
EV to Debt EV to Debt 2.77 15.28
EV to EBIT EV/EBIT -0.57 23.47
EV to EBITDA EV/EBITDA -0.41 47.80
EV to Free Cash Flow [EV/FCF] EV/FCF -2.10 38.62
EV to Market Cap EV to Market Cap 1.22 7.81
EV to Revenue EV/Rev 108.19 27.38
Price to Book Value [P/B] P/B 0.78 2.34
Price to Earnings [P/E] P/E -0.47 11.81
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) -429.38 4.66
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -5.56
Dividend per Basic Share Div per Share (Qtr) 0.00 1.73
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 49.83
Interest Coverage Int. cover (Qtr) -36.60 25.16
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -18.54 -35.10
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -13.72 15.43
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.65
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -548.11 -90.82
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -850.67 35.24
EBIT Growth (1y) % EBIT 1y % (Qtr) -569.56 -22.13
EBT Growth (1y) % EBT 1y % (Qtr) -558.57 -163.05
EPS Growth (1y) % EPS 1y % (Qtr) -21.92 -20.61
FCF Growth (1y) % FCF 1y % (Qtr) -122.12 220.21
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -1,151.59 -53.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.00 0.22
Cash Payout Ratio Cash Payout (Qtr) -0.01 0.36
Cash Ratio Cash Ratio (Qtr) 0.17 0.38
Current Ratio Curr Ratio (Qtr) 0.39 0.86
Debt to Equity Ratio Debt/Equity (Qtr) 0.35 0.70
Interest Cover Ratio Int Coverage (Qtr) -36.60 25.16
Times Interest Earned Times Interest Earned (Qtr) -36.60 25.16
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -17,563.30 -114.76
EBIT Margin % EBIT Margin % (Qtr) -18,881.42 -127.24
EBT Margin % EBT Margin % (Qtr) -19,397.28 -150.97
Gross Margin % Gross Margin % (Qtr) -547.60 67.88
Net Profit Margin % Net Margin % (Qtr) -18,775.70 -148.68