The following exceprt is from an extensive article about Ancestry.com, and its potential, found at http://seekingalpha.com.
Ancestry.com Inc. (ACOM) is a potential candidate for leverage buyout firms due to its cheap valuations and low debt. The company has high growth prospects, given the growing internet usage in North America, which is at an all-time high. The changing trend of users inquiring about their ancestors and engaging in social networking reflects the growth prospects of the company. Moreover, the stock is currently trading at a forward P/E of 16x, at a significant discount as compared to its industry average of 22x. Its three-year expected PEG ratio is 0.78. The company is generating 96% more free cash flows to equity as compared to its peers in the Internet industry. Furthermore, the company’s subscribers have increased by 20%, while its churn rate has declined from 4.6% to 3.4% from 2Q2011 to 2Q2012.
