IAC - Angi Is Undervalued - For Valid Reasons

Summary

• The stock hasn’t been able to deliver strong enough top-line metrics to keep investors excited in 2022.
• Joey Levin is taking back control over the company, which creates the possibility of spin-outs, acquisitions, and mergers.
• Q3'22 revenue grew 8% versus Q4’22 average revenue growth of 6.33% based on released data, which compares to consensus estimates of 7.1% y/y growth for Q4 ’22.
• Angi could miss top-line estimates for Q4'22, and looks very macro-dependent over the course of 2023, which makes for a weak bull case.
• We arrive at a $5 price target, which implies substantial upside even from these levels and rate the stock a Hold/Neutral.

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