Edison Investment Research Reports on Boku's Accelerated Growth and Market Outlook

Edison Investment Research Limited recently published a report on Boku (BOKU), highlighting its substantial growth in FY23 with a revenue increase of 30%. This growth was driven by a 15% increase from its direct carrier billing (DCB) core business and a significant 153% rise from eWallets and real-time payments. The report also noted a 27% year-on-year growth in EBITDA as Boku expanded its local payment method (LPM) network, focusing on technological and regulatory enhancements.

Despite Boku trading at a slight premium compared to its peers based on FY24/25 EV/EBITDA multiples, Edison's analysis, incorporating a reverse discounted cash flow (DCF), suggests the current share price accounts for below-target revenue growth and EBITDA margins for FY27–33. Nevertheless, Edison estimates a potential share value of 251p if Boku meets its targets by FY27, propelled by major merchant sign-ups and the growing contribution from partners like Amazon.