Million dollar question. Depends on your timeframe. I see Brekford, if they continue on this trajectory and can execute what's in front of them, as a dollar stock not a penny stock. When, I don't know. Cant tell you what the stock will do today or tomorrow but typically, after any big price move up, there will be a retracement, before then next leg up.
Looks like it hopeful. 52 week high, nice volume, charts look good, as I posted at the end of Feb, nice reversal on the monthly. Strong fundamentals to back it up with return to profitability and numerous prospects for major growth.
Google "Contratara municipo de saltillo cobradores de fotomultas". Local newspaper report. That translates as the local government of saltillo will contract collection agents for the camera fines.
The mayor of Saltillo is to hire debt collectors and inspectors to help collect speeding fines. Looks like they are trying everything to bring in that 34million in outstanding payments.
Hopeful my friend, you're correct to say Brekford has always had lofty ambitions. I think that comes from CB Brechin who, you have to say, dreams big. The downside of that IMO has been a lack of focus, but I think that has been addressed in recent times with the addition of Rod Hillman. He seems like a serious guy who has focused on the numbers and the operational side and really turned things around. I think you can still see Brechin's influence in the PR's, eg, "we are looking at opportunities in Asia." I read that and thought, Asia? Can we just focus on USA and Latin America please. Let the Apples of this world think about world domination. I think you're right, the reason the stock doesn't react to positive news is that there have been too many promises in the past. But again as you say, they did land Baltimore, they did provide explosive growth before and I think they'll do it again. In fact, they are in the middle of doing just that. There is going to have to be a mighty catch up in the share price when the market realises that they are actually delivering this time.
I'm surprised aaron this wasn't the subject of a separate PR. They have 16 cameras in Saltillo and its Brekford's 4th largest customer. I don't know how many cameras they will roll out for this new initiate but I'd imagine it will at least be similar. No buying on that news. Another example of how these guys keep adding contracts and cameras and the market is completely unaware of their existence.
As I posted on April 7th in "New plans for Saltilo".....this from today's PR regarding New Rochelle going live...
"We have also developed a specialized distracted driving camera that captures cell phone and seat belt usage violations, and we expect initial systems to be deployed in Mexico in the third quarter of this year"
Report out today on the one year anniversary of the Saltillo program saying road deaths are down 82% from last year. That success has to help Canviso in getting additional contracts.
While nothing about Shinsen, I did find the following report last month. My translation...
"The minister of transport said she is working on a project to put into law the regulation of the installation of speed cameras so that it comes under the power of the government. At the moment it's the local mayors who are responsible but the minister feels it should come under her remit, how, when, and where these cameras are installed, as the government is making huge investment into updating the road system."
Don't know if that will benefit Brekford or not, but it would seem to open the possibility of national as opposed to local contracts.
I saw you posted something but it wouldn't open. Perhaps yahoo doesn't permit emails. I'm posting something about Colombia now...
Hi aaron, I presume your question is addressed to me. I have been checking on Shinsen but there is nothing yet. There are some reports about new red light programs in Bogota but no mention of who. I also get the impression that they have a state of the art traffic system down there and the public buy into it more than in Mexico so I would be encouraged about any deal down there being a success.
I did mention in a previous post that the New Rochelle deal was signed a year ago and goes live this week, so that gives an indication of how long it can take to get things up and running following testing etc. So Colombia was first mooted in October 2015. In November mgmt. said "We expect to provide results and receive feedback from the City of Bogota in the fourth quarter of this year". In January they said..." we have recently made dramatic strides with our international expansion efforts in Mexico and Colombia".
I was expecting news by now and I know others sold out their position because it didn't happen sooner, but it must be close.
I'm glad you see the numbers here phanik. The market surely doesn't.
Remember Saltllo was a 210 camera program. They rolled out 16 before meeting the inevitable public opposition that these programs always get. That's why I said before if I was negotiating the next contract, I'd roll out as many as I could in the first phase.
So 16 cameras generated 35 million in one year. Fair to say ten times that (if they had rolled out 160 of the 210 cameras), would have generated close to 350 million in one year. Brekfords share would be close to 90million or ten times it's current market cap. One contract, one year.
Now you could argue all those outstanding fines wont be collected so you cant just multiply Brekford's share price by 10. But also fair to say that last year they reported overall margins of 20% while ATSE margins are around 70%, so a huge amount of that 90 million would go straight to the bank account. In that case maybe multiplying the share price by 10 isn't enough.
Again, one contract, one year. The numbers are there. Management say they are in advanced stage negotiations on other large contracts. Let's see if they deliver. And if they do, watch out.
The 35million is shared between the local government and Canviso. Brekford get half of Canviso's share so it's more like $9million. Not all of that will be collected of course but it's an indication of the numbers involved for one year of one contract to a small company like Brekford.
A report out yesterday in local newspaper Capital Coahuila stated the new program for camera installation to stop cell phone use IS being negotiated with Canviso and is planned to start in July.
Local papers reporting that the city is planning to install extra cameras to stop people using phones while driving. Not sure yet if this will be Canviso/Brekford.
I also saw a report Tuesday saying the city is telling those who have outstanding speeding fines that they have two weeks to pay otherwise the city will impound their vehicle. Last I heard USD$35 million to be collected.
Thanks for the post Fish. People might be wondering why you are writing about an agreement that dates back to February of last year but of course the program is due to go live mid-April as reported Saturday on lohud.
A couple of points. Look how long it took from contract signing to going live. This is a business that requires patience. Another reason why Brekford trades so low in a world where we want everything yesterday. I agree that these small contracts are of interest. They are easy to overlook but added together, they really amount to something. In fact New Rochelle is looking at 12 cameras, Saltillo has 16 and is already Brekford's 4th largest customer.
Something leading on from that which occurs to me and I'm sure it has occurred to management as well. I would have learned a few things from the Saltillo experience, before taking on the next large city. First, pay me more up front as the collections may be troublesome. Second, pay me a larger percentage. Also make sure you have proper systems of collection in place. And finally, with a large program of say 200 cameras, I'd roll out as many as possible upfront to get ahead of the inevitable public opposition to more.
These things are obvious to me, so I'm excited to see how Brekford negotiates its next large contract with everything they have learned.
Hi Hopeful and a happy Easter to you too!
Yes I find the price/sales comparison a very simple and accurate measure of where a company stands as regards valuation. As you say, there are lots of other metrics for comparison purposes and many reasons why one company trades at $5 and another at 16 cents. But on an apples to apples basis, it's clear that Brekford is way behind its competitors in terms of fair valuation. So as I say, and I'm glad you agree, 50+ cents is where this stock should conservatively be sitting today. That would merely bring it in line with a company like DGLY, which, as you point out, is performing much worse than Brekford. In fact, one could easily argue that BFDI should command a higher valuation than DGLY to more accurately reflect its superior trading performance. As I see it, this is a 50 cent stock trading at 16 cents. Simple.
If and when it starts growing at a faster rate with the addition of more large ATSE contracts, then we can start talking about comparing it to TASR at a price to sales ratio of 5 to 1 which would mean a $2.50 stock price, but that is for another day. Maybe next Easter.
"Total revenue increased by 15% to approximately $20.0 million in 2015, compared with approximately $17.4 million in the year ended December 31, 2014."
"The Company reported an operating loss of ($7,621,471) for the full year of 2015"
Take a look at the first line above and those results look remarkably like the one Brekford has just reported. Take a look at the second line and you realise it's another company.
Two companies, in a similar space, reporting in March, both with $20million in sales. One reported an operating loss of over $7million and the other, positive operating income of $350K. One is trading at 16 cents, the other at $4.78. It's clear which is which, right? Wrong! The above results belong to Digital Ally which has traded as high as $18 in the past year. Brekford can be bought at pennies above zero.
DGLY trades at a price to sales ratio of 1.2 to 1. Taser at a p/s ratio of 5 to 1 and Brekford at a p/s ratio of .3 to 1. This is completely unsustainable IMO. Conservatively, we should be trading at 50 cents today. Anything under that price is a steal IMO.
Add more ATSE contracts with the huge margins that they offer and soon 50 cents will look cheap.