This is a nice little SaaS business with excellent growth potential off the back of the very recent and transformational Faria Education Group partnership. For me, the investment thesis is that the Faria partnership will present significant growth potential for this company, which is not even remotely factored in at the current share price.
There is significant seasonality in this business/industry (see below) and I am expecting the next two quarters (Q3 and Q4 of CY2020) to be the biggest 2 quarters in the history of the company.
I also like that cashflow breakeven is now clearly in sight, there is no further need to raise for operating capital. Lastly, I am impressed by Harley Grosser's track record so far and I am sure he is working hard to ensure this continues. SCL wouldn't be the number 1 position in his fund if the risk-adjusted return of this stock wasn't exemplary.
From a T.A. perspective, the stock is also in a nice long term uptrend, with the current share price above both the 50 day and the 200 day moving averages.
4-5c in 6 months is in sight if management executes on the opportunity in front of them.
T.E.P.
SCL Price at posting:
2.1¢ Sentiment: Buy Disclosure: Held
