Stock Analysis & Valuation 11880 Solutions AG (TGT.DE)

• Previous Close: €0.65
• Sector Valuation Confidence Level: High

Valuation method	Value, €	Upside, %
Artificial intelligence (AI)	24.63	3719
Intrinsic value (DCF)	0.28	-57
Graham-Dodd Method	0.08	-87
Graham Formula	0.10	-85

Strategic Investment Analysis

Company Overview

11880 Solutions AG is a leading German telecommunications services provider specializing in digital and directory assistance solutions. Operating under the umbrella of United vertical media GmbH, the company serves private and business customers with a comprehensive suite of online marketing, digital advertising, and call center services. Its flagship platform, 11880.com, functions as a business directory and offers additional services such as search engine optimization (SEO), Google Ads, and corporate website development. The company also provides niche platforms like werkenntdenBESTEN.de for online reviews and wirfindendeinenJOB.de for job searches. Formerly known as telegate AG, 11880 Solutions AG has evolved into a digital-first business, leveraging its expertise in directory services to support small and medium-sized enterprises (SMEs) in enhancing their online presence. Headquartered in Essen, Germany, the company operates in a competitive telecommunications sector, where digital transformation and local business support remain key growth drivers.

Investment Summary

11880 Solutions AG presents a high-risk investment opportunity due to its negative net income (-€4.29M in FY 2023) and volatile operating cash flow (€1.7M). While the company operates in a growing digital marketing and directory services space, its financial performance indicates ongoing challenges in profitability. The lack of dividends and a low beta (0.205) suggest limited volatility but also subdued growth prospects. Investors should weigh the company’s niche market positioning against its financial instability before considering exposure. Potential upside lies in its SME-focused digital services, but execution risks and competitive pressures remain significant concerns.

Competitive Analysis

11880 Solutions AG competes in the fragmented German digital directory and online marketing industry, where differentiation is key. Its competitive advantage stems from its established 11880.com platform and specialized services like review and job portals, which cater to local businesses. However, the company faces intense competition from global tech giants and local digital marketing firms. Its financial struggles (negative EPS of -€0.17) highlight operational inefficiencies, possibly due to high customer acquisition costs or pricing pressures. The company’s subsidiary structure under United vertical media GmbH provides some stability, but its small market cap (~€16.9M) limits scalability. To maintain relevance, 11880 Solutions AG must enhance its digital offerings, possibly through AI-driven marketing tools or expanded SME partnerships, while improving cost management to achieve profitability.

Major Competitors

• Yelp Inc. (YELP): Yelp dominates the online review and local business directory space globally, with strong brand recognition and a scalable platform. Unlike 11880 Solutions, Yelp benefits from a larger user base and advertising revenue. However, Yelp faces criticism for its review moderation policies, which 11880’s werkenntdenBESTEN.de could exploit with a more localized approach.
• Alphabet Inc. (Google) (GOOGL): Google’s search and advertising ecosystem, including Google My Business, directly competes with 11880’s directory and SEO services. Google’s vast resources and AI capabilities give it an insurmountable scale advantage, but 11880’s focus on German SMEs offers niche differentiation in local customer service and support.
• Hochtief AG (HOC.DE): Hochtief’s digital infrastructure services overlap indirectly with 11880’s business solutions, particularly in corporate website development. However, Hochtief’s larger scale and construction-focused model make it a peripheral competitor. 11880’s specialization in directories gives it an edge in local digital marketing.
• Inpost S.A. (FRA:INP): Inpost’s parcel locker network and digital logistics solutions do not directly compete with 11880 but highlight the broader trend of digital service integration. 11880’s opportunity lies in bundling directory services with logistics support for SMEs, a gap Inpost does not address.