STTCOMP CR8, FA Long Cre8tek Limited SP: $0.054 SOI: 407,977,502...

STTCOMP CR8, FA Long
Cre8tek Limited

SP: $0.054
SOI:    407,977,502
MC:    $22m
Cash: $2.5m at 31 December 2016
EV: $19.5m

CR8 or Flamingo is well known to all of us on the STT threads by now.

CR8 has faced a large retail sell down as of late, primarily due to the fear of the thought of an impending capital raising and the delay of a major contract rollout for a Fortune 100 company. @Cuse kindly provided some broker data, attached below.



According to the 4C, CR8 had $2.5m cash at the end of Q4 16, with a projection of $1.15m outflow for Q1 17. This would leave $1.35m cash remaining at the beginning of Q2, the same quarter as CR8 is expecting a big shift from paid trials to ongoing monthly subscription based revenue.

In addition to this shift, the company has recently announced that they are undertaking a paid Proof of Technology trial with a global US based property and casualty insurance company, and Australia’s own AMP Limited.

With these two paid trials for large clients and the Nationwide rollout estimated to begin in Q2, CR8 has been quoted saying that “Cre8tek would like to assure investors that this extension has no material effect on the business”. Personally, I would class a capital raising to be of material effect to the business, and as such, I wouldn’t expect one until H2 2017.

These levels haven’t been seen since November and with a market cap of only $22m for a leading AI company with a rock star management team, I believe CR8 presents a great buying opportunity at the moment.

Disclosure: Held