$26m is a low market cap - normally for companies on the verge of bankruptcy.
But in the case of RCL, it's probably that they're in a relatively small-sized market - domestic education software.
I'd be more pleased if they could reach break even - can then sort of start to think about a valuation based on earnings, but more so for the safety.
$26m market cap should have approx $2m PA earnings (NPAT).
They're a fair way off that. $8m PA receipts, and around 20% cash burn on top of receipts (-20% profit margin, which is generally improving over time).
So...I'm holding because they're trending in the right direction. Scale increasing, receipts increasing, and COVID maybe encouraging an accelerated shift to study from home, scale would benefit margins (because of fixed expenses).
But at this point in time, they still need to improve a lot more to justify a moderately higher share price.
RCL Price at posting:
22.0¢ Sentiment: Buy Disclosure: Held
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