CV1 vs XF1 - Significantly Undervalued, page-4

I think thats right re: automated reference checks. XF1 have proved the utility of the product, there is clearly demand for it.

I think the market underestimates the size of CV1’s B2B client base. It rivals XF1’s. So the upselling opportunity is significant.

XF1 do a better job at telling the story and highlighting the quality of their business, but if you do the work you find that CV1 is of equal quality. They could benefit by borrowing from XF1’s investor relations strategy and I think that would help drive a re-rate of the stock.

If you value that client base on some reasonable assumptions (increasing ARPU, more bundling, increased customer take up, low churn, etc) I get a figure of 20-25c before any further growth.

There isn’t any reason why CV1 couldn’t be on the same multiple (or very close) to XF1, or to be trading with a $100m market cap. It is really just a question of whether the market takes a liking to the story. But one step at a time. The key will be sales growth.

Agree it will take time for the new sales strategy to fully kick in. Give it 6 months or so I’d say. But there is no reason why B2B revenue can’t grow 30% in the mean time just from upselling to the existing clients.

And yes, plenty of interest in HR tech stocks for those that are really executing. Get it right and the market will give you a lofty multiple.

As for short term, who knows. Based on what Rod talked about on the conference call I would expect some positive news flow.