Third, the end of nonrecurring charges related to restructuring and prior litigation and corresponding settlements, coupled with revenue growth and a material reduction in interest paid on its outstanding debt should lead to material free cash flow generation in 2024 that we believe will grow substantially in 2025. Lastly, we should note that in December of ’23, we were asked to join Synchronoss’ board of directors to help with the company’s execution on its next phase of growth. We couldn’t be more excited. As we look at what that means for the stock price of Synchronoss, it ended last year at $6.21 which equated to a multiple of enterprise value to estimated 2024 EBITDA of approximately 5.6x. This multiple declines to approximately 5.2x if Synchronous receives the kinds of inflows it should receive this year from its tax refund.
We do not believe a cloud focused business with 85% to 90% recurring revenue, 70% to 75% gross margins and 25%-plus EBITDA margin that also generates positive free cash flows should command such a low multiple. In our opinion, a more appropriate multiple would be in the double digits. And if so, the stock has a chance to go to well north of $20 a share and approach $30 a share just based on that valuation change. We believe this is just the start of Synchronoss and 2024 will be a turning point for Synchronoss, both in terms of its business and how investors value the stock. While our investment with Comscore started out as a collaboration, the continued gridlock on the Comscore board towards resolving capital structure issues and other governance issues has led to another level for us of activism as we embark on a potential proxy contest that we are 100% prepared to launch this spring.
Our initial investment in Comscore took place in 2021 following its recap by Charter, Cerberus and Liberty. Our original thesis for our investment was centered on multiple factors, including our belief that Comscore was a company with uniquely competitive media management offerings and proprietary data; Comscore’s new investments would help with improved execution, financial performance and overall growth; and Comscore traded at a significant discount to its peers. While Comscore’s business has improved dramatically under new management with 33% EBITDA growth over the last 2 years, the stock has declined precipitously. We believe this is due to poor corporate governance and uncertainty around Comscore’s capital structure. As a result, we have ramped up our activism significantly through the nomination of Matt McLaughlin as a director nominee for consideration at Comscore’s upcoming Annual Meeting of Stockholders.
Matt is a retired advertising technology executive and naval officer. Most recently, he served as chief operating officer of DoubleVerify Holdings, a software and platform company for digital media measurement and analytics. He served there from 2011 to 2022. As COO of DoubleVerify, Matt directed its product engineering and sales operations activity, including managing over half the company’s employees. Given Comscore’s struggles with and focus on improving its digital offerings, we can think of nobody more useful to this Comscore board and management than Matt. He has been available to speak with Comscore stockholders. Ones that wish to speak with him can reach us directly. While we actively are preparing to run a competitive proxy campaign to support his candidacy, we certainly hope that Comscore’s board will realize the complementary skill set that we believe he can bring to help build value for all of Comscore’s stakeholders and that a competitive proxy contest will not be required.
Let me stop there and turn it over to Daniel.
Daniel Wolfe: Thanks, Kevin. Please turn to Slide 13. As we noted in our press release on February 1 of ’24, the discount of our NAV to stock price was approximately 26% as of the end of January ’24. This discount equates to a NAV at the end of January that was approximately 8% higher than at the end of 2023. We established the Discount Management Program to make it clear that the management and Board of 180 Degree Capital are serious about our intentions to narrow this discount. At the end of each measurement period, our Board will consider all available options, including but not limited to a larger buyback than the 5 million current authorized — currently authorized, a cash distribution that will be considered a return of capital or a tender offer.
The management and Board are completely aligned with our stockholders and that we collectively own about 12% of 180 Degree Capital’s outstanding shares. And this ownership continues to grow solely through open market purchases, largely of after-tax dollars. We are laser-focused on creating value for all stockholders of 180 through growth of our NAV and the narrowing of this discount. Please turn to Slides 14 and 15. We provided similar slides last quarter and thought it would be useful to do so this quarter as well. Subsequent to the end of ’23, many of our portfolio companies issued press releases that provided updates on their respective businesses. We summarized a number of these releases on these slides. Potbelly continued to report strong growth that exceeded expectations and announced a new credit facility that provides meaningful interest savings and financial flexibility to fund growth initiatives.
Synchronoss announced completion of its cost removal program at the upper end of its initial target range along with strong performance for the fourth quarter of ’23. Manoj Bhargava is now the majority owner of Arena Group through a $12 million investment at a substantial premium to the company’s trading price at the day of when that investment was made. Arena also filed the Form S-4 registration statement for the merger with Mr. Bhargava’s Bridge Media. Comscore announced a new agreement with Nexstar that we believe will lead to Nexstar being a top 10 customer for Comscore. Ascent is now focused on its chemicals business through the appointment of that division’s president and CFO as the new CEO and CFO of the entire company. Brightcove announced a new streaming deal with the second largest TV network in Brazil.
