Is Nuix lucrative for a takeover?, page-20

These Nuix HC forums are in shambles. This place is full of either parasitic down rampers or shameless pumpers claiming to be selling their undergarments to finance further purchase of their shares.

No room for some rationale or open-minded discussion at all. As a small shareholder of Nuix I just want to share my thoughts on this entire fiasco.

Nuix had more than 20% revenue growth between the years 17/18, 18/19 & 19/20 which is nothing to be scoffed at. I believe the dire straits the company finds itself in today is due to factors mainly beyond its control.

The first downgrade from IPO prospectus forecast as everyone is aware was due to the transition to consumption-based invoicing rather than an all you can eat model where revenue from multi-year contracts is recognized upfront. This makes sense as a SaaS based model will provide more reliable and higher revenue streams over the coming years and as has been mentioned previously is the way forward for all companies operating in this industry.

I believe the second downgrade has been partly caused by the sustained campaign by Fairfax media against the company. As a finance professional I was very surprised to see that the CFO and CEO did not have clear visibility over their revenue a month out from year end. A further digging led me to the following snippets on information from two AFR articles:

The following is from an AFR article on 8th June:

Another AFR article on 22nd May states the following:

The Macquarie contract will most likely be realized in the next financial year as the bank does not want to be seen as awarding Nuix a large contract in a year in which its struggling to meet its forecasts.

In the short term I foresee the share price being in doldrums due to the above stated reasons. Once the media pressure abates and the governance issues are sorted out the company should be able to prosper. Investigative analytics and data processing needs will only continue to grow and gather pace as the transformation to digitalisation and AI continues. With a solid product and reputation, Nuix is well placed to take advantage of this growing market. You only have to see the valuations that Nuix peers are trading at to get an idea of the true potential of the company.

Will I be buying any more shares at this price? Not really as I see better short-term opportunities elsewhere. However, I might add more to my investment in the company once I see some shoots of green on the horizon.