Too many annoying newbies in the latest announcement that are having a stab at me for selling haha. As you guys know I've been in & out a few times over the past few years based on financial analysis.
I thought I'd update the usual bunch in this thread with my thoughts - these are
my opinion / focussing on numbers:
- ACV: Monthly growth is impressive on the face but stripping out 1/2 for PG&E as a one-off makes it a little less impressive. Technically every month we will not sign PG&E for $420k. I agree though that this will grow, albeit, slowly. Overall ignoring PG&E, it was a decent ACV figure.
- Cashflow: I don't really buy the whole, ACV run-rate basis, if you run the numbers you'll notice that we will lose money for a while. I suspect we will need to raise capital in CY21 at some stage. Just remember that NEA paid dividends in 2014/15 then went on to lose money in turn for ACV growth. It's not bad to not be in a negative operating state as the market pays a premium for growth so I don't think overall it is too bad. Also, the 4C is in $$AUD! So it was a lot lower than expected in my eyes.
- Pipeline: Overall it was kind of disappointing, SCE/FPL have been mentioned for a while now with nothing material arising. No mention of Boeing or MBL so I suspect they are really on the backburner now. Interestingly, no real mention of Bevan Slattery and how he has helped? He is a busy guy so I don't think he has done much for the company so far.
Recutting the numbers, it honestly still looks OK but management will need to really pick up some momentum and the run rate will need to be at least 30% of ACV (i.e. for this Sep 2020 quarter, on that basis it should have been at least 1.2m USD!?).
Forward P/ACV looks good if management can deliver (note everything is USD). These numbers are pretty bullish on the ACV, even if you optimistically think 9 x $0.5m per month + 5m now, only at $9.5m by June 2021. Need some chunky contracts to come in and I honestly do not think the business operates in that fashion.
Just my opinion and thoughts so DYOR. Thought I'd share this analysis as 3DP has been my top pick since 2018/19. A few messages today saying did you break up with your exxy girlfriend today? I sure did haha.
But I might be back once that ACV & cashflow looks a bit more clear!
