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HEXO Valuation

Q: What is the Fair Price of 74H when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

74H (€0.63) is trading below our estimate of [[fair value]] (€5.69)

Is 74H undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
Price-To-Sales vs Peers
Price-To-Sales vs Industry
Price-To-Sales vs Fair Ratio
Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of 74H when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 74H (€0.63) is trading below our estimate of fair value (€5.69)

Significantly Below Fair Value: 74H is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 74H?

Key metric: As 74H is unprofitable we use its Price-To-Sales Ratio for relative valuation analysis.

The above table shows the Price to Sales ratio for 74H. This is calculated by dividing 74H's market cap by their current revenue.
What is 74H's PS Ratio?
PS Ratio	0.3x
Sales	CA$124.10m
Market Cap	CA$40.04m

74H key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	1.6x
Enterprise Value/EBITDA	-1.6x
PEG Ratio	n/a

Price to Sales Ratio vs Peers

How does 74H's PS Ratio compare to its peers?

The above table shows the PS ratio for 74H vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	Forward PS	Estimated Growth	Market Cap
Peer Average	1.5x
B8FK Biofrontera	0.8x	n/a	€16.4m
APPH Apontis Pharma	2x	17.3%	€80.3m
93M1 MPH Health Care	0.9x	-60.2%	€105.3m
PSG PharmaSGP Holding	2.6x	7.7%	€280.6m
74H HEXO	0.3x	-0.7%	€40.0m

Price-To-Sales vs Peers: 74H is good value based on its Price-To-Sales Ratio (0.3x) compared to the peer average (2.3x).

Price to Sales Ratio vs Industry

How does 74H's PS Ratio compare vs other companies in the European Pharmaceuticals Industry?

24 Companies	Price / Sales	Estimated Growth	Market Cap
Industry Avg.	2.9x	3.4%
74H HEXO	0.3x	-0.7%	US$30.41m

24 Companies		Estimated Growth	Market Cap
Industry Avg.	2.9x	21.6%
74H HEXO	0.3x	83.6%	US$30.41m

No more companies

Price-To-Sales vs Industry: 74H is good value based on its Price-To-Sales Ratio (0.3x) compared to the European Pharmaceuticals industry average (3.3x)

Price to Sales Ratio vs Fair Ratio

What is 74H's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

74H PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio	0.3x
Fair PS Ratio	0.5x

Price-To-Sales vs Fair Ratio: 74H is good value based on its Price-To-Sales Ratio (0.3x) compared to the estimated Fair Price-To-Sales Ratio (0.5x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst 74H forecast and predictions for the stock price in 12 month’s time.
Date	Share Price	Average 1Y Price Target	Dispersion	High	Low	1Y Actual price	Analysts
Current	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Nov ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Oct ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Sep ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Aug ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Jul ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Jun ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
May ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Apr ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Mar ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Feb ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Jan ’25	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Dec ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Nov ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Oct ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Sep ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Aug ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Jul ’24	n/a	€0.90 0%	25.9%	€1.14	€0.64	n/a	4
Jun ’24	€0.89	€1.10 +24.1%	5.2%	€1.17	€1.00	n/a	5
May ’24	€1.08	€1.10 +1.7%	5.2%	€1.17	€1.00	n/a	5
Apr ’24	€1.20	€1.32 +10.2%	40.5%	€2.37	€0.54	n/a	7
Mar ’24	€1.58	€1.76 +11.6%	25.2%	€2.43	€0.97	n/a	8
Feb ’24	€1.45	€1.76 +21.4%	25.2%	€2.40	€0.96	n/a	8
Jan ’24	€0.97	€1.87 +93.5%	20.1%	€2.41	€0.96	n/a	8
Dec ’23	€2.05	€2.32 +13.5%	26.4%	€3.00	€1.00	n/a	8
Nov ’23	€2.82	€2.48 -12.2%	40.4%	€4.14	€1.04	n/a	9

Analyst Forecast: Target price is more than 20% higher than the current share price, but analysts are not within a statistically confident range of agreement.

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