Bilibili Is Expensive At 6.7x Sales And Sales Growth Of 46%

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About: Bilibili Inc. (BILI), Includes: CMCM, HUYA
by: Saint Fleur Investment Research
This article is exclusive for subscribers.
Saint Fleur Investment Research
Short only, Growth, long-term horizon
Summary

Bilibili is a Chinese platform offering online entertainment thought videos, live broadcasting, and mobile games.

The previous company founded by the CEO, Mr. Chen, saw massive enterprise decline after the company’s sales growth diminished.

Regarding the role of Mr. Chen, we need to point out that we dislike his appointment as CEO and Chairman of the Board Of Directors.

We don’t expect the stock to have a lot of upside potential.

If we use 2019 Sales of RMB 6.735 billion or $966 million, Bilibili trades at 6.7x sales. Considesidering sales growth of 63% in 2019, it is a bit expensive.

With the market expecting sales growth of 46% in 2020, Bilibili (BILI) should not be trading at 6.7x sales. In our view, as revenue growth declines, the company’s EV/Sales ratio will decline. Investors