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[Idea note] - Sinch: Turnaround Opportunity at Attractive Valuation

Alcur has increased its stake in Sinch, believing that the market’s pessimism is now overly pessimistic.

Author

Kristoffer Lindström
July 10, 2025

Idea note

This is an Idea note; It’s a collection of early signals – companies mentioned in fund letters, blogs, or by sharp investors online. Not a full pitch, just a starting point for ideas that might be worth a more in-depth look.

Messaging Giant Poised for Recovery as Fundamentals Improve

Idea source: Alcur

Price: 29.7 SEK (2025-07-10)

Sinch AB is a global cloud communications platform provider, enabling businesses to connect with customers through messaging, voice, and video. The company operates in the Communications Services sector and is listed on Nasdaq Stockholm.

Ticker: SINCH | Timeframe: 12-24 months | 🔁 Turnaround

Alcur has increased its stake in Sinch, believing that the market’s pessimism is now overly pessimistic. While Sinch was previously valued at high multiples during the pandemic due to strong growth expectations, subsequent setbacks in growth, cash flow, and leverage caused a significant drop in the share price. Alcur now sees that Sinch’s organic growth and cash flow generation are improving, and its leverage is under control. With an EV/EBITDA of just over 9x for NTM, Alcur considers the stock attractively valued.

  • Setup: Sinch’s share price collapsed after pandemic-era optimism faded and operational challenges emerged.

  • Latest Development: Organic growth and cash flow are showing positive trends; the company has addressed balance sheet concerns.

  • Reason for Mispricing: The market’s perception remains overly negative, not reflecting operational improvements.

  • Timing: Improvements in fundamentals are expected to become more visible over the next 1–2 years.

  • Value Catalysts: Continued organic growth, stronger cash flow, and further deleveraging could drive a rerating.

  • Valuation: Trades at EV/EBITDA ~9x NTM, below sector peers.

  • Upside Potential: Multiple expansion and earnings growth as market sentiment normalizes.

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