"sorry i wasnt able to "reply" my response which was posted on the 29/7. Do you have any thoughts?"
It isn't clear from that what it is you are asking me.
If it's what impact AI will have on STG (i.e., ranging between opportunity and existential threat), then I can't add much value because it will amount to pure conjecture on my part.
Personally, I don't think anyone can say for certainty what the company will look like in 5 or 10 years time, or even if it will still exist, let along resume growing its Revenues and Cash Flows, so I think it is futile to speculate [*]
But I think its moot, anyway, because the business is already being valued like it is in the cusp of some kind of extinction event.
So, even if it merely goes sideways - or even dies a slow and lingering death over a number of years - at an EV of $12m, the stock was pricing in an even worse outcome than that.
[*] If pressed for a view, I'd say that AI will be a burden, not a boon, for STG's business. But even if it does start to cannabalise (or continue to do so, as the case might well be) the top line, the business has some $30m of CoDB which can be throttled back to insulate the bottom-line if the business was forced into de facto run-off mode. And if that was the case, it doesn't need too many years of further existence for the Market Value to be fully cash-backed.
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STG Price at posting:
44.0¢ Sentiment: None Disclosure: Held
