I think so. Let's assume revenue growth slows to 12% Q over Q between now and FYE Feb14. That would put us at $8.325M for 4Q13. A TTM revenue total of $27M and a current run rate of $33.3M.
Quarterly revenues for FYE Feb14 would be $9.3M, $10.4M (breakeven as forecast), $11.7M and $13.1M giving AUGT, as of FYE Feb14, TTM revenues of $44.5M and a per annum run rate of $52.4M.
I believe they will achieve that at a minimum (I am assuming -0- from IP) and I can wait a year for that to transpire. Then they can start shopping for buyers from a significantly stronger position.
Another year of 8% Q over Q growth would put us at around $64M of TTM revenues and a annual revenue run rate of $71.3M at the end of FYE Feb15.
Anyone think this kind of growth is not doable? Any growth in excess of these assumptions will be nice icing on a very tasty cake.
I think it is too easy to make the numbers tto show almost any revs 1 year out. But we have to realize that these projections are guesses at best. There are too many uncertainties. Another way to look at it is: there are many hedge fund managers with way sharper projection skills than any one of us. Why dont they "get" it? I think its more like there is something we are missing (vs them). Its like the saying a good friend keeps reminding me of: "In a poker game, if you dont know who the fool is.... likely the fool is you. "
Bob I actually agree with you to some extent here but some stocks are just extremely under-the-radar and I'd think that a $50 million market cap bulletin board stock could be a likely candidate. Another explanation is that the company has lost a lot of credibility and they funds may be hesitant to jump in until it's clear that the cost-cutting has been successful and there's a clear path to cash-blow BE from operations.
I've been in your shoes here on this board, and I actually find you to be quite objective. You do ask relevant questions and bring up relevant points even if they're inconvenient to some. I personally appreciate it. I know that I (like many others) have done a ton of DD on AUGT and though they're far from perfect, the risk/reward is the best I can find in the market today. They have a new management team in place. They've clearly been executing their plan on increasing their revenues. They're also doing well lowering costs, though due to the severance packages from a couple of top management execs/board members it may take another quarter to really start to see that. They've now cut some litigation costs by ending the AOL lawsuit as well, though I think they still have a lot more to go here. The company's biggest failure by far has been in monetizing the IP. My opinion is that they need to do whatever they need to do yo monetize it. I believe it holds more value than they'll ultimately get for it, and that's a shame, however, the company simply isn't and has never been adequately capitalized to maximize their value.
Keep the comments coming, it provides good food for thought. My opinion is that by knowing and understanding the fundamentals on this one, being able to envision what the company's income statement is going to look like once all of the one-time severance-related expenses have come off the books (the last of them should be taken in Q4) along with the reduction/elimination of litigation-related expenses, I think you'll see there is a clear path to operation cash-flow BE and also to GAAP profitability once the picture becomes a little bit clearer. I think your idea of waiting until the stock hits a certain price level to ensure that in your opinion the bottom is in is a smart one. You definitely don't need to catch the bottom here to still make a lot of money, and I can tell you with a good amount of certainty that the people who have been buying at these levels will do quite well for themselves. I own a lot more stock in this company than I ever thought I would, however, I'm still objective in the way I look at it, I know what would cause me to sell and not look back etc. While some of the naysayers here dwell on the past, none have provided any sort of compelling argument backed by numbers evidencing why they won't do well in the future, it's all fueled by conjecture, bitterness etc....
lol...you are the subtle type basher huh boob? The fool is you bud. The man who is actually in charge of the HC sales machine, the man who built that division, with the greatest first hand data on the revenue is very comfortable with 15% over the next 5 Qs on the conservative side. I take that above anyone's number or your blind analysts projections. Give it up man. Your subtle approach of instilling doubt here is not going to work. But go collect your 50 cents for this post! lol
Sentiment: Strong Buy
Looking.....On the revenue growth side for FY14 I would agree that on the conservative side you will see 52M. This much I have verified with management and its very doable. In fact, the larger RFPs in the 7 digits category are just starting to come in this year in large numbers. With amount of clients that we have currently, 350+, and 95% of them continually increasing their spending and contract size with us there comes a time that we will see an explosive ramp up. Our AdServe network is only 8 months old and its experiencing tremendous growth with only 15% penetration into our current client base. This is one of the hottest growth engine for Augme and one that can be mirrored to MM's growth pattern from 2010 till now. The kicker for us is that we have a strong mobile marketing base that already loves our AdLife platform which can be up sold with AdServe AND any new client that we get starting with our AdServe can be easily up sold with AdLife. Ad Network is a much easier and quicker sale then mobile marketing is and the burn rate and turn around on the contract are much quicker too. The beauty of our end to end single platform system is that once you hook a client on either side of the isle, mobile marketing or Ad network, they will be on the same system and therefore exposed to the entire power of system which then the account representative can use to up sale. Its truly a winning proposition from a technology upgrade perspective.
The only unknown is our IP and its cost on this growth path. With AOL now out of the way with a license the burn rate on our expanse side comes down tremendously as this case with all its fronts was a huge drain on our cash. I am eager to see what the effects of this and final cost cutting will be on our numbers for this Q. I believe we will be pleasantly surprised. If we can show a decent decline the stock will react positively as it proves that we can reach BE and maintain cash.
Sentiment: Strong Buy
On the revenue growth side for FY14 I would agree that on the conservative side you will see 52M". That would definitely catapult the stock probably - above $5.00 a share price. You do know FY-14 starts in March right? This company does have a confusing reporting cycle. 52 Million is 13 million a quarter - or to average 13 million for the year revenue will have to grow much greater than the predicted 15-20 Q over Q growth rate. More like 50% Q over Q - I think that's a bit overzealous at the moment and given what we know not even close to reality. 35 Million is wthin reach though - the company could break-even or make a small profit for the year at that level...and the stock price should be higher than it is now.
What don't you get? Their growth rate is pathetic when you consider the sector they compete in and how much it's growng. This is an industry doing something around $1.5-$2 billion/yr. and AUGT only grows about $1 million/qtr. That's awful. When you're this tiny in a burgeoning sector you should be growing much, much faster if you want to be anywhere considered a player. AUGT is not a player.
You have made some really good points in the past so I respect your views.I too looked at AUGT vs the space and my conclusion is that on their own they may have difficulties competing in the future.
Howver, I dont think you have considered the potential of Hc within a much larger entity with deep pockets.I think the key to realizing shareholder value is cleaning up the balance sheet and to make HC as lean as possible and at the same time as attractive as possible.
SO while you are correct on one hand you may be missing the true opportunity on the other. I am not sure the sell off is done yet. So I am patiently waiting for turn around in SP. A break out above .45/ .50 decisively on strong volume would do it.
I was attempting to come at from less that optimum scenario. Obviously not worst case, but pretty weak. If with those conservative numbers looks like this good be a good investment. Of course, I understand that as they become cash flow positive and are able to reinvest that cash in the business they should be able to grow at much faster rates as you point out. Again icing on the cake.