Still happily holding onto CXZ. I'm not looking for anything...

Still happily holding onto CXZ. I'm not looking for anything crazy as far as revenue growth here with the single contract with GM. So top-line single-digit % numbers in the reports don't concern me.

At 2.5c, the company has a market cap of ~$22M. We've got $2.8M of Revenue this Qtr, and $5.4M in H1 25. We can probably expect consistent numbers for Q4 , as it is a pretty consistent business cycle. So assume $10.5M to $11M in Rev for FY25.

NPBT FY24 was $2.66M. In H1 FY25 was $1.527M. Plus $0.83M in Q3. So assume $3M to $3.3M in NPBT in FY25.

These figures are all in USD, where the market cap stated above is in AUD. In USD, our Market Cap is $14-15M USD. This means that the company is trading at approximately 4.5x Earnings. It doesn't get much cheaper than this as far as a price-to-earnings ratio, and to me the financials of CXZ are very strong.

However, the market is rarely wrong, and there is good reason for the company to be trading at such a low multiple, the company only has one Customer. This agreement with General Motors is long-standing, and was renewed in Jan-23. But how long and what are the terms of this deal, if other holders know further details, please feel free to enlighten me ?

In Jul-23, CXZ Quarterly Report said "the extension [with GM] took effect in January, and is expected to be formalised in due course via an extended agreement". But reviewing a couple quarterly reports following that, I can't see any details on the terms and/or end-date of this agreement.

To me, this stock will see a significant re-rate in the case that either:
GM Contract is renewed with increased capacity/incentives for dealerships; OR
The Company is bought out (I would think that as the end of the contract gets nearer, there is commercial opportunity for GM to make an offer on CXZ); OR
A new OEM as a Customer.

I can appreciate that CXZ are continually trying to break down the OEM market for new customers. It is an incredibly sticky service industry, and as a result a small pool of OEMs are only going to switch fleet management providers for good reason.

Alternatively, one of Connexions biggest competitors in the industry is probably Geotab. A recent article in thelogic seems to think that Geotab has hit unicorn status ($1B Valuation). It wouldn't take me by surprise at all if a big player in the industry saw the margins, revenue and profitability of the CXZ Contract and technologies, and bought it up as well.

All some food for thought to generate a little discussion here. Nonetheless, I do think that a dollar invested in this company is at slight risk, but the reward has potential to be significant.