Is Brave Bison Group plc (LON:BBSN) a Sell Candidate or Undervalued Opportunity?

Brave Bison Group plc (LON:BBSN) has been a rollercoaster ride for investors in recent weeks, with its stock price swinging between optimism and caution. As of August 29, 2025, the stock closed at 60.00p, down 4% from its previous close of 62.50p, despite a 44.05% surge in market cap over the past year [1]. This volatility raises a critical question: Is the stock a sell candidate amid its recent pullback, or does it represent an undervalued opportunity for long-term investors?

The Valuation Case: DCF and Margins

Using a discounted cash flow (DCF) analysis, Brave Bison’s fair value is estimated at 0.50p per share, slightly below its current price of 60.00p [3]. However, this valuation predates the company’s acquisition of The Fifth Limited, which is expected to boost earnings in the current financial year [2]. The company’s trailing PE ratio of 18.75 and forward PE of 8.33 suggest it trades at a discount to its projected growth [3]. With a gross margin of 65.01% and a profit margin of 6.89%, Brave Bison’s profitability metrics are robust, especially for a company in its growth phase [3].

Market Dynamics: Volatility and Analyst Optimism

The stock’s recent price action has been erratic. On August 29, it swung between 57.00p and 62.78p, a 10.14% intraday range, before closing at 60.00p [1]. Technical indicators like moving averages and MACD currently signal caution [1]. Yet, analysts project a 100% upside, with a 12-month price target of 120p [4]. This optimism is fueled by projected revenue growth of 71.36% in 2025 to £36.5 million and an EBITDA margin expansion to 22.19% [5].

Strategic Catalysts and Risks

Brave Bison’s acquisition of The Fifth Limited adds a new revenue stream and diversifies its offerings [2]. The company also ended 2024 with £7.5 million in cash, a significant improvement from its 2023 net debt position [4]. However, the stock’s short-term volatility and mixed technical signals suggest investors should approach with caution. The recent 4% drop, while painful, could be a buying opportunity for those who believe in the company’s long-term growth story.

Conclusion: A Calculated Buy

While Brave Bison’s near-term technicals are bearish, its fundamentals and analyst projections paint a compelling case for long-term investors. The DCF model may undervalue the company’s recent strategic moves, and the 12-month price target of 120p implies a 100% upside. For those with a 12- to 18-month horizon, this appears to be an undervalued opportunity, provided the company can execute its acquisition strategy and maintain its profit margins.

Source:
[1] Brave Bison Group (AIM:BBSN) Market Cap & Net Worth, [https://stockanalysis.com/quote/aim/BBSN/market-cap/]
[2] Brave Bison Group plc to acquire The Fifth, [https://www.inpublishing.co.uk/articles/brave-bison-group-plc-to-acquire-the-fifth-25265]
[3] Estimating The Fair Value Of Brave Bison Group plc, [https://uk.finance.yahoo.com/news/estimating-fair-value-brave-bison-072100514.html]
[4] Brave Bison (BBSN) Stock Forecast & Price Target, [https://www.investing.com/equities/rightster-grp-consensus-estimates]
[5] Brave Bison Group plc (BBSN.L), [https://ca.finance.yahoo.com/quote/BBSN.L/analysis/]