Another very solid result. Congratulations to Aaryn, Tasso, and...

Another very solid result. Congratulations to Aaryn, Tasso, and the team.

The ship has been steadied and is now a) sailing in the right direction and b) is picking up speed. With another quarter of profit in the tank, working capital has increased to $3.9 million and the enterprise value of CXZ is currently sitting at a mere $10 million. At these levels, it is becoming a deep value play.



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@completelybroke -- they don't need a "new product".

Resigning GM on equivalent (or improved) terms alongside ongoing customization and enhancement work will be enough to justify a $30+ million valuation in its own right. That's a significant upside from current levels. My personal view is that CXZ will not leverage its pricing power in contract renegotiations. They have now hinted that their strategy is along the lines of "come for the tool, stay for the network". Although CXZ's pricing is approximately 50% of competing products, it is the 22% market share that is most valuable.

From there, they will continue to execute on the commercialisation opportunities that present themselves -- i.e. integration across the automotive ecosystem via APIs. Moreover, CXZ will roll out the white label product -- CXZTRAC -- which will have applications for both non-GM and non-CTP use by Dealers. The strategy here is clear -- they can cross-sell the product because many existing GM dealers are multi-franchise (selling multiple OEMs outside of GM). An MVP version of the white-label product was already trialed during the quarter ahead of a broader rollout. Expansion from this strategy is what the institutional investor community will want to see (in addition to re-signing GM). Although there are politics at play, it wouldn't surprise me at all to see Lucerne re-join the register once Aaryn begins to demonstrate the success of this strategy. Lucerne understand the story and will be pleased to see the new board composition (whereby MC no longer has strings to pull).

Interesting to see all of the 1.5c offers being taken out yesterday. I think there will come a time in the not too distant future where offers under 2c (and eventually 3c) are very hard to come by. With 880M shares on issue, 3c is a market capitalisation of just $26 million. The question you have to ask yourselves as investors is would you pay $26 million for a profitable growing SaaS company with a massive market share if GM is re-signed? I think there are institutions that would.

I've lowered my average entry price to ~1.7 cents. I'll continue to mop up shares around 1.4 cents even though I am overweight here and am now in the Top 30. In my eyes, the value proposition at these levels is too tempting not to hold a meaningful position here.

T.E.P.