NoHo Partners operates a large Finnish (and Nordic) restaurant and hospitality portfolio. The business throws off cash (≈9.9% FCF yield), which is what the screen's 'Attractive' valuation percentile latches onto, but it earns below its cost of capital — adjusted ROIC of 4.9% versus an 8% WACC — and destroys economic value (−€14M EP).
Critically, the capital structure is heavily levered: €318M net debt against just €115M equity (~2.8×). Bridging the reverse-DCF enterprise value through that debt leaves negative equity value at every growth assumption — and, because returns are below WACC, faster growth destroys more value, not less.
The reverse-DCF capitalises adjusted NOPAT of €21.1M but, after €318M net debt across 21M shares, the implied equity value is negative in the base case — the market price (€7.35) rests on a recovery in consumer spending and deleveraging that is far from assured. With EP negative, the screen's cheap EV/EBIT is precisely the trap the conviction layer exists to catch.
Base €5.50 (−25%, de-rate toward through-cycle economics); bull €9.00 (consumer recovery + meaningful deleveraging restores equity value); bear €3.50 (recession or refinancing stress on the levered balance sheet).
At today’s enterprise value the constant-ROIC reverse-DCF maxes out: even at its sustainable-growth ceiling (~-50.0%, limited by ROIC 5% ≈ WACC 8%) it cannot reach the current EV. No-growth value is €-6/share (-79% of price); the market prices in growth and/or a higher ROIC than booked — richly valued on this lens. Read the sensitivity grid.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | €9 | ≥-50% | +23% | 25% | Consumer recovery + real deleveraging restores equity |
| Base | €6 | ≥-50% | -25% | 40% | De-rate toward through-cycle economics |
| Bear | €4 | ≥-50% | -52% | 35% | Recession / refinancing stress on levered balance sheet |
| Prob-weighted | €6 | — | -22% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 6.50% | -3 | -4 | -5 | -7 | -8 | -12 |
| 7.25% | -5 | -6 | -7 | -9 | -10 | -15 |
| 8.00% (base) | -6 | -7 | -8 | -11 | -12 | -17 |
| 8.75% | -7 | -8 | -10 | -12 | -13 | -19 |
| 9.50% | -7 | -9 | -10 | -13 | -14 | -20 |
Green = fair value above the current price of €7.32. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.
If Nordic consumer spending rebounds, high fixed costs amplify earnings and could restore equity value — the bull path.
Debt paydown from FCF would transfer value from creditors to equity over time.
≈9.9% FCF yield funds debt service and is the sole support for the equity today.
A scaled, multi-brand hospitality platform with some pricing power in premium venues.
Margin initiatives could lift ROIC toward the cost of capital if executed.
NoHo is the batch's marquee screen-correction: cheap on EV/EBIT, but sub-WACC returns plus ~2.8× leverage make the equity a value-trap with negative through-cycle value. We rate it SELL/Avoid, medium conviction; base target €5.50 (−25%).
Only a combination of consumer recovery and tangible deleveraging would change the thesis — until then the risk/reward favours creditors over shareholders.