Goldman Sachs Investment Banking Pitch Book
Goldman
Sachs
O Public Market Perspectives on Opal
PRELIMINARY CONFIDENTIAL DRAFT-SUBJECT TO CHANGE AFTER FURTHER DILIGENCE AND REVIEW
INVESTMENT BANKING
DIVISION
Viewed over a range of historical time periods, Opal's share price has underperformed relative to that of its peer
groups¹
Time Period
Last 10 Years
Last 5 Years
Last 3 Years
Last 1 Year
Opal
CY2013E Multiple
Enterprise Value / Sales²
Enterprise Value / EBITDA²
P/E
Operating P/E³
(62)%
(66)%
(37)%
(35)%
HP
Opal
0.2/0.3 x
2.6/3.4
31%
(70)%
(67)%
(35)%
5.3
1.4
Whole Co
1296 %
54 %
61%
25 %
0.4 x
3.2
3.6
2.4
EUC
99 %
(21)%
26 %
25 %
■ Opal's current public trading multiples also lag those of its peers, likely owing to a range of potential factors, including
but not limited to, EUC segment financials overwhelming the Enterprise segment financials, views on the PC market
outlook, an expectation of lower growth, overhang of recent underperformance, and a "show me" investor viewpoint
regarding the Company's strategy
WholeCo
2.3 x
7.0
- Additionally, Opal's significant cash balances may not be attributed full value by investors as it consists primarily of
offshore cash and also because some investors may have the view that the cash will be used for acquisitions that
may have limited P&L impact in the near term
HP
12.3
9.4
Enterprise Software
271 %
1%
14%
16%
EUC
329 %
54 %
51%
17%
0.1 x
5.7
12.6
7.4
Services
382 %
61%
61%
34 %
Enterprise Software
1.3 x
2.6 x
5.4
7.3
12.6
11.7
7.9
9.1
Services
S&P
1.1 X
8.2
43%
(6)%
1%
(4)%
11.8
11.0
S&P
0.1 x
3.3
7.3
5.1
■ 52% and 41% of Wall Street research analysts have a Buy or Hold recommendation on Opal, respectively, with a
median price target of $14.00 and a price target ranging from $9.00 to $18.50
- EPS estimates for FY2014 and FY2015 have trended downward since the first and second quarter earnings
announcements
Source: Bloomberg company reports, public filings, Capital 1Q and IBES
WholeCo peer composite consists of Accenture Apple Cisco EMC HP IBM, Microsoft Oracle, SAP EUC peer composite consists of Acer, AsusTek and Lenovo Enterprise peer composite consists of Brocade, Cisco, EMC, HP, IBM, Juniper
and NetApp Services peer composte consists of BMC Software CA Compuware Informatica Microsoft Oracle SAP, Symantec and Teco S&P peer composite consists of Ingram Micro and TechData
First figure represents Opas EV/EBITDA multiple Second figure assumes the public market adjusts Opal's cash balance for the tax associated with repatriating Opal's offshore cash balances, assuming 100% of cash is offshore
Operating P/E calculated by removing cash per share from each company's share priceView entire presentation