This is an interesting Co. , but I have no idea how to value it. My opinion is that it's worth whatever people are willing to pay for it. As such and after the recent price drops, I went long yesterday. May well drop lower - who knows? But long term, I am willing to punt that it's a winner. May have to average my share price down at lower levels though (hope not, but certainly possible). Reminds me a bit of another software Co. I recently invested in - FLN (Freelancer).
Some of my ACX investment reasoning:
1) they are a global leader in Construction industry software;
2) They've already signed some huge names (Exxon Mobil!)
3) The Construction industry has a lot of room to develop - it's still old fashioned with respect to processes. I work in Construction and have seen this first hand, many times. All the serious EPCs and Erection Contractors will take advantage of technology, to reduce their costs and hence be more competitive (and make more $). This will take time, but will happen.
4) From my brief online research, they have a good product and have been spending on R&D, to keep developing it
5) Rolling multiple processes into 1 system will be huge - Design, Procurement, Claims, Documentation, Engineering, etc. Seems like a lot of this has already been achieved by ACX? No doubt it can be further developed though. If this is effective, they'll do very well.
The key for me, is to become the biggest global player (I read reports they were already, however I don't know if this is self-promotion?). If they are and have some of the biggest firms onboard with their software, it'll flow down to the smaller firms - who'll be forced to use it for that Project. If their product is good, the smaller firms will consider using it on their own, future Projects - which will force even smaller firms to use it for that Project. And so on and so forth. The goal would be to become "the convention", in Construction software. At the moment and due to the opportunity, there's a lot of competition (eg. the Contractor on my current job, uses Procore). So they need to get some good Sales guys out there too. I think I read in 1 of the reports, that they were pushing Sales in the near future - so this is good.
Cheers.
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