Envela Corporation (NYSE: ELA) and its subsidiaries are involved in several recommerce-related businesses, including the recommercialization of luxury assets (jewelry, diamonds, fine watches, and so on), asset recycling, IT asset management services, and providing services to industrial and commercial businesses. Its subsidiaries are 1) DGSE, LLC, which specializes in the recommercialization of hard luxury assets through the Dallas Gold & Silver Exchange, Charleston Gold & Diamond Exchange, and Bullion Express brands; and 2) ECHG, LLC, which refurbishes and resells consumer electronics and IT equipment.
Why Should Investors Book Profit?
Valuation Methodology: Price/Earnings Multiple Based Relative Valuation
(Analysis by Kalkine Group)
* % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
ELA's share price has declined 4.24% in the past six months and is currently trading close to the mid-band of the 52-week range of USD 3.51 to USD 6.31. We have valued the stock using the Price/Earnings-based relative valuation methodology and arrived at a target price of USD 3.75.
Considering the company's increasing debt, weak margins, current valuation and associated risks, we recommend a "Sell" rating on the stock at the closing price of USD 4.18, up 1.95% as of March 02, 2022.
Three-Year Technical Price Chart (as of March 02, 2022). Source: REFINITIV, Analysis by Kalkine Group
* The reference data in this report has been partly sourced from REFINITIV.
* All forecasted figures and industry information have been taken from REFINITIV.