I feel your pain on this one. For me, fortunately, my stops have...

I feel your pain on this one. For me, fortunately, my stops have saved me from most of the share price disaster here. Stops can be very effective.

However the company execs cannot directly control the share price. Many tech stocks have suffered falls after massive interest rate rises. 40 cents was generous and probably overvalued.

All that the company can control is the revenue and profit, the share price is just expected to follow.

Quarterly revenue has been steadily growing for 2 years now. This includes both through acquisitions and organic. By my calcs, organic revenue growth should still be above 15% for this year, possibly more (although this is a bit murky to estimate based on 4Cs alone).

Operating EBITDA is also growing – potentially still up year on year by 15-19% (depending on what numbers and unbilled WIP you use from quarterlies). Yearly cash flow is positive. A small positive statutory NPAT is likely this year and operating NPAT is almost certainly positive. Debt costs are down.

But more importantly (especially after growth through acquisitions) the revenue PER SHARE is also still growing year on year, as is likely the EBITDA per share. This is in spite of new shares being issued.

Recent share price falls have made the share price to revenue and EBITDA ratios very low, which means this stocks is quite undervalued.Generally, I do not support the “bottom of the drawer” fund for poorly performing stocks, even though it is tempting. You want all of your money growing, and stocks in that drawer generally don’t grow, or worse, keep falling. Sell, wait for better news and then buy back in.

But, having said that it is also about any chances for near term re-valuation catalysts. There are a few for this stock. First, the market tech stock concerns are now waning. Secondly the company have said that they’ll publish their plans for growth by fin year end. And thirdly, Q4 numbers should be very good and very cash flow positive, and this expectation may be reinforced when the company announces its growth plans. And BTW, I am NOT yet fully back into this stock so have little incentive to talk it up – I still plan to buy more.