Concurrent (CCUR) on Monday is unveiling to the world new breakthrough technology that can insert alternate videos into video on demand (VOD), meaning TV commercials. It could add billions in new ad revs for cable TV industry, which is about to invest heavily into monetizing the 6.8 billion free-on-demand videos watched annually. CCUR is the world's largest video on demand (VOD) technology provider with 212 deployments across 4 continents. CCUR's total VOD servers deployed worldwide support over 2.4mm concurrent VOD streams reaching 50mm households!
CCUR has 9.2mm o/s with $24.6mm in cash, no debt, and an enterprise value at $7.50 of only $44.4mm or just 0.71x its trailing revenues or 0.67x its 2Q 2013 revenues annualized. CCUR's gross margins of 58.81% exceed the #2 VOD operator Seachange (SEAC)'s margins of 50.18%. SEAC has enterprise value/revenue ratio of 1.85, which values CCUR at $15.26. CCUR's 2Q 2013 EPS was up 100% from its 1Q 2013 EPS and up 300% from its 4Q 2012 EPS. CCUR latest annualized non-GAAP EPS is $0.50 and SEAC's P/E of 30 would value CCUR at $15!
CCUR in recent weeks just announced 2 new clients that will become among its top 5 revenue generating clients. CCUR signed a HUGE multi-screen video delivery deal to power Virgin Media's Virgin TV Anywhere multi-screen service for tablets/smartphones as well as a new VOD client that is an unnamed Top 5 North American MSO. CCUR already works with Time Warner Cable and CCUR's technology isn't for satellite operators like DirecTV or Dish, so the new unnamed North American client must be either Comcast, the #1 largest U.S. cable TV company or Verizon Fios, the #1 largest U.S. telco TV company. CCUR's two huge new clients have potential to add a combined $24mm in revs, increasing CCUR's annualized revs from $66.4mm today to $90.4mm, an increase of 36.1%. Assuming operating expenses grow at rate of 10.84% or about 1/3 of revenue growth, CCUR's annualized non-GAAP EPS could grow from $0.50 to $1.30!