Equity research: An analysis on Farfetch´s IPO

• Autor(a) principal: Matias, Pedro Miguel Jordão
• Data de Publicação: 2019
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10071/19371
• topic: Value of firm; Equity research; Corporate finance; Valuation models; Valor da empresa; Avaliação do capital próprio; Finanças da empresa; Modelos de avaliação; Avaliação de empresas -- Business valuation; Empresa cotada na bolsa; Mercado de ações; Indústria de produtos de luxo; Moda; Trabalho de projeto

The personal luxury goods market has been growing over the past 20 years, presenting an annual growth rate of 6%, being that in 2017 it registered a value over 300 billion of dollars. The regions of America and Europe are the main geographical market segments, representing 65% of the personal luxury goods market, even though the Asian region has shown a big growth over the last years, due to its economic development. The online segment has been increasing, driven by the strong and fast technological development, being that this segment represents 9% of the market and it registered a growth rate of 24% in 2017. The fast growth observed in the online segment is also due to the generational shift that is occurring over the last years, since the consumers of the generations Y and Z are increasing. Therefore, Farfetch is taking advantage of the opportunities that the market provides, to its development and growth, and it became a listed company on the North American stock exchange NASDAQ. This project aims to valuate the company upon its listing on the stock market, where it will be valued the price per share through different valuation model, and the values obtained will be compared between them and with Farfetch’s IPO price. Taking into consideration the results, it was concluded that the IPO price of 20 dollars per share, falls short from the values obtained through the DCF models, so it is suggested to buy the shares of the IPO.