I agree Jocko..
As investors, we should seek and be invested in stocks that have a more than reasonable chance of achieving a SP catalyst that on the grounds of probability, re-rates the SP.
This stock in my view has a number of likely catalysts.
1. Soon to be announced contracts; locking in long term annuity revenue. Timing weeks/months.
2. PayDay Super reforms; locking in the tripling of revenue. Timing 24 - 36 months.
3. International expansion; greater than the current Hong Kong opportunity. Timing 24 - 36 mths.
4. Become a likely takeover target; annuity style SaaS revenue streams, 85 %+ GP margin attracting a premium priced offer. Timing 3 - 5 yrs.
These type of SaaS businesses generally attract a high takeover premium. SuperChoice and other similar business on the ASX have provided historical potential Mkt Cap guidance.
For example,
SOI SP Mkt Cap
1.7B. 0.12. $204M
1.7B. 0.16. $272M
1.7B. 0.20. $340M
1.7B. 0.30. $510M
1.7B. 0.40. $680M
1.7B. 0.50. $850M
I will leave it to your own analysis of how far this business will grow in mkt cap before a takeover bid is made.
Ian
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