Another Tech Turnaround Story
|Written by GSCR Staff|
|Wednesday, 06 February 2013 10:18|
Good morning! Tech stocks seem to be taking off with several turn around stories early this year. Here is another one we found with this same theme.
USA Technologies (NASDAQ – USAT - $2.37) has been around since 1992, but last week announced its first non-GAAP profit in 20 years. The profits were just over $150,000 for 2Q13 after losing $1.8 million for 1Q13. The stock has rallied about 15% on the news since, with fairly high relative volume of roughly 600,000-700,000 shares traded per session. The charts also indicate a bullish signal in the short–term over the next 30 days.
USA Technologies is a unique company that offers wireless networking, cashless transactions, asset monitoring, and other similar services to smaller retail markets in the US and internationally. The company’s main service is providing ePort Connect, a payment facilitation service, and additionally telemetry and machine-to-machine (M2M) services to monitor, control, and report the results of distributed assets containing electronic payment solutions. The ePort Edge is a magnetic swipe-only cashless payment system with software ePort SDK, ePort QuickConnect, and eSuds, a solution for the commercial laundry industry that enables laundry operators to provide customers cashless transactions via credit cards, debit cards, and other payment mediums, such as student IDs. Finally, the company manufactures and sells energy products which reduce and manage electrical power consumption of equipment such as refrigerated vending machines and glass front coolers.
As evidenced by the financials, USAT appears primed for a continued turnaround with new products and other revenue generation. It just released ePort Mobile, which allows vendors to accept debit and credit cards on smart-phones opening up the huge multi-billion dollar industry to USAT. Additionally, the company has steadily increased repeat business with license and transaction fees.
Management has projects a 30% rise in revenue for FY13, and we believe that the stock could climb to the $3.50 level.
Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.
This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports.
It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations.
The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.
This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.
ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.
For more information, visit our Disclaimer: www.goldmanresearch.com
Leave your comments