CTRP - Arco Platform IPO: Expensive At 6.45x Forward Sales
Showing an impressive 53% y/y revenue growth and with a business model that does not require a lot of fixed asset investment, Arco (ARCE) is organizing a new IPO to acquire other competitors. It is a serious company that investors should assess.
With that, the educational group has several issues that investors will not appreciate. Firstly, the shares are expensive at 6.45x forward sales. Other competitors are trading at much lower valuations. In addition, the company has two types of shares and it was incorporated in Cayman Islands.
Source: Prospectus
The underwriters working