SPAC Deep Dive, subSPAC

subSPAC

SPAC Deep Dive

Each week we’ll identify and break down for you SPACs that are capturing market share and making an impact.

Thematic (Sector/Industry)

<ul>
<li>We identify and break down for you SPACs that are capturing market share and making an impact.</li>
<li>SPACs have thrived for the better part of the last eighteen months because it has filled a void for both investors and companies looking to raise capital.</li>
<li>Early Stage Companies also benefit from SPAC deals as they have access to a large pool of capital, can accelerate the process of going public, and even provide forward-looking guidance</li>
</ul>


We identify and break down for you SPACs that are capturing market share and making an impact.
SPACs have thrived for the better part of the last eighteen months because it has filled a void for both investors and companies looking to raise capital.
Early Stage Companies also benefit from SPAC deals as they have access to a large pool of capital, can accelerate the process of going public, and even provide forward-looking guidance


Independent Research, SPACs, SPAC Track

SPAC Track

Independent Research, SPACs

Equity Capital Markets

DD3 Acquisition Corp II / Equity Capital Markets

<ul><li>DD3 Acquisition Corp. II <em><strong>(DDMX)</strong></em><a href="https://www.globenewswire.com/news-release/2021/11/19/2338254/0/en/DD3-Acquisition-Corp-II-Stockholders-Approve-Business-Combination-with-Codere-Online.html" target="_blank" rel="noopener">shareholders approve</a> the merger with Codere Online. Set to close on 11/30 followed by ticker change to CDRO.</li><li>Yunhong International <em><strong>(ZGYH) </strong></em><a href="https://www.sec.gov/ix?doc=/Archives/edgar/data/1773086/000110465921142009/tm2133495d1_8k.htm" target="_blank" rel="noopener">will liquidate</a> as opposed to extending. It will dissolve and return $10.31 per public share.</li><li>SoFi Technologies, Inc. <em><strong>(SOFI)</strong></em><a href="https://www.businesswire.com/news/home/20211119005721/en/SoFi-Technologies-Inc.-Announces-%C3%A2%C2%80%C2%9CRedemption-Fair-Market-Value%C3%A2%C2%80%C2%9D-in-Connection-With-Redemption-of-its-Outstanding-Warrants" target="_blank" rel="noopener">Announces “Redemption Fair Market Value”</a> in Connection With Redemption of its Outstanding Warrants</li></ul>

DD3 Acquisition Corp. II (DDMX)shareholders approve the merger with Codere Online. Set to close on 11/30 followed by ticker change to CDRO.Yunhong International (ZGYH) will liquidate as opposed to extending. It will dissolve and return $10.31 per public share.SoFi Technologies, Inc. (SOFI)Announces “Redemption Fair Market Value” in Connection With Redemption of its Outstanding Warrants

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/moneylion-inc" target="_blank" data-smartkarma-citation="entities:34686:1" rel="noopener">MoneyLion (ML US)</a> , one of the fastest growing fintech companies, went public via SPAC in February and shares were listed on the NYSE in September. The company merged with SPAC Fusion Acquisition at combined enterprise value of ~$2.4 billion, PIPE investors acquired 25 million Class A shares for $10.00 per share and private placement was closed prior to close of business combination. Therefore, MoneyLion has raised $250 million from investors such as BlackRock and private equity firm Apollo Global Management. Citibank, Broadhaven and FT Partners served as financial advisors to MoneyLion while J.P. Morgan Securities acted as financial advisor to Fusion.</p>

MoneyLion (ML US) , one of the fastest growing fintech companies, went public via SPAC in February and shares were listed on the NYSE in September. The company merged with SPAC Fusion Acquisition at combined enterprise value of ~$2.4 billion, PIPE investors acquired 25 million Class A shares for $10.00 per share and private placement was closed prior to close of business combination. Therefore, MoneyLion has raised $250 million from investors such as BlackRock and private equity firm Apollo Global Management. Citibank, Broadhaven and FT Partners served as financial advisors to MoneyLion while J.P. Morgan Securities acted as financial advisor to Fusion.

MoneyLion: The Downside Looks Limited and Valuations Remain Attractive

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<header id="article-header_2-0"><p data-tooltip="Khadija Khartit is a strategy, investment, and funding expert, and an educator of fintech and strategic finance in top universities. She has been an investor, entrepreneur, and advisor for more than 25 years. She is a FINRA Series 7, 63, and 66 license holder." data-inline-tooltip="true" data-tooltip-position-x="left" data-tooltip-position-y="top">Founded in 2013, <a href="https://www.smartkarma.com/entities/moneylion-inc" target="_blank" data-smartkarma-citation="entities:34686:1" rel="noopener">MoneyLion (ML US)</a> is a fintech company that provides lending, mobile banking, cash advances, financial advisory, and investment services including crypto trading to its users. The company aims to empower mobile banking and other financial products through machine learning and artificial intelligence technologies. Since its launch in 2013, MoneyLion has engaged with nearly 8.7 million users. </p></header><p data-tooltip="Khadija Khartit is a strategy, investment, and funding expert, and an educator of fintech and strategic finance in top universities. She has been an investor, entrepreneur, and advisor for more than 25 years. She is a FINRA Series 7, 63, and 66 license holder." data-inline-tooltip="true" data-tooltip-position-x="left" data-tooltip-position-y="top">In February 2021,<a href="https://www.reuters.com/technology/mobile-bank-moneylion-go-public-via-blank-check-merger-29-bln-deal-2021-02-12/" target="_blank" rel="noopener"> MoneyLion</a> agreed to go public through a merger with a blank-check firm Fusion Acquisition Corp <a href="https://www.reuters.com/companies/FUSE.N" target="_blank" rel="noopener">(FUSE.N)</a>, that would value the equity of the combined company at $2.9 billion. As of 26 October 2021, MoneyLion's market cap is $1.4 billion. MoneyLion completed its public listing on the NYSE in September 2021.</p><div class="content-highlight">
<h2>Valuation</h2>
<p>Our base case valuation of MoneyLion over the next year is $9.5 per share, which would be 59% higher than current share price. Our base case valuation is based on EV/S of 7.5x using our estimated sales of $257 million in 2022. We took a 10% discount to the company's guidance sales in 2022 to be more conservative. </p>
<p>The EV/S multiple of 7.5x is about 50% discount to the average EV/S multiple of its peers, which is mainly due to its lower operating margins and size effect. However, if the company is able to generate higher sales growth and more sizeable improvement to operating margins than its peers in the next several quarters, this valuation discount is likely to decline considerably. </p>
<p>Unlike in 2H 2020 to 1Q 2021 when there was a much positive sentiment on SPACs and SPAC related mergers, this sentiment has worsened considerably in the past six months. This is probably one of the reasons why the stock has taken such a beating since going public in the past month. We would argue that the fundamentals of the company is improving and the financial metrics of MoneyLion remain solid. Therefore, we would be a Buyer of <a href="https://www.smartkarma.com/entities/moneylion-inc" target="_blank" data-smartkarma-citation="entities:34686:1" rel="noopener">MoneyLion (ML US)</a> shares at current depressed levels.</p>
</div>

Founded in 2013, MoneyLion (ML US) is a fintech company that provides lending, mobile banking, cash advances, financial advisory, and investment services including crypto trading to its users. The company aims to empower mobile banking and other financial products through machine learning and artificial intelligence technologies. Since its launch in 2013, MoneyLion has engaged with nearly 8.7 million users. In February 2021, MoneyLion agreed to go public through a merger with a blank-check firm Fusion Acquisition Corp (FUSE.N), that would value the equity of the combined company at $2.9 billion. As of 26 October 2021, MoneyLion's market cap is $1.4 billion. MoneyLion completed its public listing on the NYSE in September 2021.
Valuation
Our base case valuation of MoneyLion over the next year is $9.5 per share, which would be 59% higher than current share price. Our base case valuation is based on EV/S of 7.5x using our estimated sales of $257 million in 2022. We took a 10% discount to the company's guidance sales in 2022 to be more conservative. 
The EV/S multiple of 7.5x is about 50% discount to the average EV/S multiple of its peers, which is mainly due to its lower operating margins and size effect. However, if the company is able to generate higher sales growth and more sizeable improvement to operating margins than its peers in the next several quarters, this valuation discount is likely to decline considerably. 
Unlike in 2H 2020 to 1Q 2021 when there was a much positive sentiment on SPACs and SPAC related mergers, this sentiment has worsened considerably in the past six months. This is probably one of the reasons why the stock has taken such a beating since going public in the past month. We would argue that the fundamentals of the company is improving and the financial metrics of MoneyLion remain solid. Therefore, we would be a Buyer of MoneyLion (ML US) shares at current depressed levels.


MoneyLion - An Oversold Fintech Stock Following a SPAC Merger

Equity Analyst, Investi Analyst

Investi Analyst

Equity Analyst

Investment Entrepreneur / Equity Analyst.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/social-finance-inc" target="_blank" data-smartkarma-citation="entities:33332" rel="noopener">SoFi (0604939D US)</a> is a Fintech company that provides a suite of financial products to the consumer (B2C) meanwhile, <a href="https://www.smartkarma.com/entities/galileo-financial-technologies-inc" target="_blank" data-smartkarma-citation="entities:33331" rel="noopener">Galileo (1760304D US)</a> is a leading Fintech infrastructure platform serving upcoming Neo banks (B2B).</li>
<li>The merger between SoFi and Galileo has created an impenetrable moat that enables them to serve multiple verticals across the Fintech ecosystem and maintain a strong competitive position.</li>
<li>This article aims to provide a deep-dive and comprehensive analysis into SoFi's competitive advantage. We discuss highlights from the latest FY 2020 financial results and Q1 2021 Guidance.</li>
<li>This article is balanced by discussing the major risks that is posed to SoFi within the evolving Fintech market.</li>
<li>SoFi recently announced that the SPAC merger is now effective with the SEC and they intend to close the deal on May 28, and start trading as SoFi.</li>
</ul>



SoFi (0604939D US) is a Fintech company that provides a suite of financial products to the consumer (B2C) meanwhile, Galileo (1760304D US) is a leading Fintech infrastructure platform serving upcoming Neo banks (B2B).
The merger between SoFi and Galileo has created an impenetrable moat that enables them to serve multiple verticals across the Fintech ecosystem and maintain a strong competitive position.
This article aims to provide a deep-dive and comprehensive analysis into SoFi's competitive advantage. We discuss highlights from the latest FY 2020 financial results and Q1 2021 Guidance.
This article is balanced by discussing the major risks that is posed to SoFi within the evolving Fintech market.
SoFi recently announced that the SPAC merger is now effective with the SEC and they intend to close the deal on May 28, and start trading as SoFi.


SoFi And Galileo Deep Dive: Building An Impenetrable Moat Within The Fintech Ecosystem

United States

Credit Acceptance Corporation provides funding, receivables management, collection, sales training, and related services to automobile dealers.  The Company provides indirect financing for buyers with limited access to traditional sources of consumer credit.  Credit Acceptance operates in the United States.

OneMain Holdings Inc. provides consumer financial services. The Company provides responsible loan products to customers through its branch network and through its centralized operations. OneMain Holdings operates in the United States.

SLM Corporation, commonly known as Sallie Mae, provides education funding, originating and servicing of U.S. government guaranteed and private student loans.  The Company, through its subsidiaries, also provides debt management services and business and technical products to a range of clients including colleges, universities and loan guarantors.

Nelnet, Inc. is a consumer finance company that provides products and services to participants in the education finance process.  The Company originates, holds, and services education loans and offers a broad range of financial services and technology-based products, including student loan origination and lending, student loan, and guarantee services.

FirstCash Holdings, Inc. owns and operates pawn stores. The Company focuses on serving cash and credit constrained consumers through its retail pawn locations. FirstCash Holdings serves customers worldwide.

Ally Financial Inc. is a automotive financial services company powered by a direct banking franchise. The Company operates as a financial holding company.

Bread Financial Holdings Inc. operates as a tech-forward financial services company. The Company offers personalized payment, lending, and saving solutions. Bread Financial Holdings serves customers worldwide.

Enova International, Inc. offers online financial services to people who have bank accounts but have limited access to traditional consumer credit from banks, thrifts, credit card companies and other lenders. The Company offers short-term consumer and installment consumer loans in the United States, the United Kingdom, Australia, and Canada.

Navient Corporation's focus is in education loan portfolio management, servicing and asset recovery. The Company acts as a servicer for Department of Education and FFELP loans as well as private student loans.

Encore Capital Group, Inc. is involved in consumer debt buying and recovery. The company purchases portfolios of defaulted consumer receivables from banks, credit unions, and utility providers and partners with individuals as they repay their obligations and work toward financial recovery.

Muthoot Finance Ltd. is a gold financing company. The Company provides personal and business loans secured by gold jewellery, or Gold Loans primarily to individuals who possess gold jewelry but can't access formal credit lines.

SBI Cards and Payment Services Private Limited provides credit card services. The Company offers payment products and services in the form of corporate and credit cards with incentive and rewards programs. SBI Cards and Payment Services serves customers in India.

SBI Cards & Payment Services (SBICARD IN)

Sundaram Finance Ltd., together with its subsidiaries, provides various financial products and services in India. The Company offers savings products, car and commercial vehicle finance, insurance products, home loans and logistics services. Sundaram is based in Chennai, India.

Mahindra & Mahindra Financial Services Limited is a finance company that provides finance to prospective buyers of Mahindra range of utility vehicles and tractors.  The Company extends finance through hire purchase/loan and lease modes.  Mahindra & Mahindra has a network of branches located across India.

Mahindra & Mahindra Fin Services Ltd. (MMFS IN)

ACOM CO., LTD is a consumer financing company.  The Company provides financial services such as secured/unsecured loans and consumer installment credits.

Shriram Finance Limited provides consumer finance services. The Company offers automobile, commercial vehicle, business, and gold loan services. Shriram Finance serves customers in India.

Samsung Card Co., Ltd. offers credit card services such as issuing cards, one time payments, installments, and cash advance services. The Company also provides other financial services such as leasing and loan services.

Credit Saison Co., Ltd. is a consumer credit company.  The Company provides financial services such as credit cards, consumer installment credits, loan guarantees, loans, consignment operations, and leases.

Muangthai Capital Public Company Limited operates as a commercial lending company. The Company provides car title, personal, agricultural vehicle, land title, and other loan products. Muangthai Capital serves customers in Thailand.

Taiwan Acceptance Corp. provides car financing and leasing services.

SoFi Technologies, Inc. is an online personal finance company and online bank. The Company provides financial products including student and auto loan refinancing, mortgages, personal loans, credit card, investing, and banking through both mobile app and desktop interfaces. SoFi Technologies serves customers in the United States.

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SoFi Technologies (SOFI US)

Three SPAC Sectors to Look at in 2022

We identify and break down for you SPACs that are capturing market share and making an impact. SPACs have thrived for the better part of the last...

subSPAC

A Rare Liquidation Appears.

DD3 Acquisition Corp. II (DDMX) shareholders approve the merger with Codere Online. Set to close on 11/30 followed by ticker change to CDRO.

SPAC Track

MoneyLion: The Downside Looks Limited and Valuations Remain Attractive

MoneyLion shares look undervalued relative to peers and our 12-month price target of $9.00 per share implies ~50% upside

Andrei Zakharov

MoneyLion - An Oversold Fintech Stock Following a SPAC Merger

MoneyLion is an oversold fintech stock following a SPAC merger. Our base case valuation of MoneyLion over the next year is $9.5 per share, which...

Douglas Kim

SoFi And Galileo Deep Dive: Building An Impenetrable Moat Within The Fintech Ecosystem

SoFi is a Fintech company that provides a suite of financial products to the consumer (B2C) meanwhile, Galileo is a leading Fintech infrastructure...

Investi Analyst

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