Look, I actually think the valuation is reasonable here. I'm...

Look, I actually think the valuation is reasonable here. I'm still far from optimistic about CXZ's growth prospects - it's just a tough competitive field out there - so I don't expect new contract wins here, but even without contract wins I think you can justify the price now just on GM's contract.

I do think the contract will be renewed. CXZ has the Ontrac expertise, having built the software, so they are best placed to continue to manage it. It's too much trouble to look for a new team to manage the program, and train them up from scratch (since they won't have any ontrac experience), and imo the operational risk is too great when 4000+ dealerships rely on the software functioning well to provide customers courtesy car services.

Based on the contract being renewed, with the PE ratio at low multiples, I do not think CXZ's valuation look demanding.

Key risk for me is whether the subscription revenues have bottomed, and whether they will return as the economy picks up again. Will dealers continue to cut subscriptions as part of cost cutting measures? Will the sub cuts be permanent? I don't know the answer to this, but it's plausible to me that subscription revenue will continue to fall. This will have an outsized impact on the bottom line due to the high margin nature of the subs revenue, imo. If subscription revenues continue falling and never recover, I think CXZ is a zero. I think the subscription revenue is likely to recover, but I can't be sure.

IbBought some shares at the open this morning. Still risks here, and that's why it's speculative and I've only got money I'm prepared to lose here. Was going to wait until the quarterly to see how subscription numbers were going, but I now expect CXZ will exercise its right not to lodge quarterlies, having achieved its requisite 4th profitable quarterly in the June quarter. I surmise this from comments here saying the next business update is going to be at the AGM, ie. not the next quarterly. It's plausible to me that the next time they lodge a financial report will be next year with the half yearly, after which subscription numbers *may* show stabilisation, which should be positive for the share price. (near term the share price may continue drifting lower. Ex chairman Caruso has hired a silk to defend him in court, could mean he sells shares to fund his court case)

Welcome any contrary views (as long as they are constructive). I get things wrong often, and might have got this one wrong too, so feel free to criticise my arguments.