Pelatro Share Discussion Threads

[mfhmfh] 20/4/2021 14:27

I agree.

CEO Subash Menon's brother, Suresh Yezhuvath, subscribed for 1,000,0000 shares, i.e. £470,000 in the placing.

only 3p above this placing price at the moment.

[paleje] 20/4/2021 14:12

Still cheap at 50p only a bit higher than last August's placing price 47p which attracted serious insider investment. See what he's got to say tomorrow.

[mfhmfh] 20/4/2021 09:45

70p end of this week hopefully

[pugugly] 20/4/2021 09:36

Marker at 47/50 up 9p 22% on ST - inv Chronic comment

[estienne] 20/4/2021 09:28

This is what ST wrote, "Based on Cenkos’ current year cash profit estimate of $2.9m – the $0.2m forecast operating loss is stated after a non-cash $3.1m depreciation and amortisation charge – Pelatro’s enterprise valuation to cash profit multiple of 6.5 times is hardly excessive for a company that should be cash-flow neutral this year, reversing a $2.3m outflow in 2020. Pelatro is also lowly rated on a multiple of 3.5 times ARR to enterprise valuation – software companies operating Software-as-a-Service models are generally rated on between eight to 10 times their ARR.

As the directors convert more contracts in their $16m pipeline into ARR, and revenue starts to be earned from the mobile advertising space, I expect Pelatro’s profits to scale up rapidly and the shares to make a concerted move towards my 100p fair value target to value the equity at £37m, or 10 times 2022 forecast cash profit of $3.5m.

From a technical perspective, a chart break-out above the October 2020 high (48p) would confirm that the base formation is complete to clear the path for a rally to the June 2020 high of 73p"

[sphere25] 20/4/2021 08:37

Just the 30% pop higher with the ST effect then.

Hmmmm...

...

...

...

Oh go on then, I'm sure we'll take it! :-)

Abit of a delay but it has played out. Well done if you caught this one.

Long termers must surely be pushing for this company to get out there more and present and try and attract the investors. Surely if you're making these bullish noises, particularly relative to what appears to be a low valuation then it makes even more sense.


All imo
DYOR

[masurenguy] 20/4/2021 07:37

😊 About time this found some support - it has just drifted on the tide for the past 18 months !

[rivaldo] 20/4/2021 07:23

Apparently ST's article has a 100p price target based on 10 x forecast cash profit in 2022 of USD3.5M:

"profits to scale up rapidly and the shares to make a concerted move towards my 100p fair value target"

[rivaldo] 20/4/2021 06:22

Great spot, cheers.....here's the link (I assume it was posted last night):



"Profit from big data analytics

Simon Thompson highlights a small-cap software company that is using artificial intelligence to create a valuable recurring income stream
April 19, 2021

Annual recurring revenue increases 35 per cent year on year.
Cash collection rates improve.
Move into mobile advertising space.

Aim-traded Pelatro (PTRO:40p), a company that makes its money by providing 19 large telecoms operators with precision marketing software, has been making huge strides in transitioning from a lumpy licence fee model to one based on annual recurring revenue (ARR).

Pelatro uses 'big data' analytics (artificial intelligence, machine learning and other analytical techniques) to reveal patterns, trends, associations and behavioural traits of telecom subscribers. In turn, this insight enables telecom operators to monetise their data, boost average revenue per user and increase their share of subscriber spend. Adopting a more customer-centric approach to marketing also reduces churn rates.

etc"

[mfhmfh] 20/4/2021 04:10

Very positive by ST in IC.

[p1nkfish] 19/4/2021 18:39

Added today too. Fingers crossed.

[gersemi] 19/4/2021 17:56

Low valuation

Although the share price is largely unchanged since I covered the half-year results (‘Priced for profitable outcomes’ 13 October 2021), there is clear value on offer here.

Based on Cenkos’ current year cash profit estimate of $2.9m – the $0.2m forecast operating loss is stated after a non-cash $3.1m depreciation and amortisation charge – Pelatro’s enterprise valuation to cash profit multiple of 6.5 times is hardly excessive for a company that should be cash-flow neutral this year, reversing a $2.3m outflow in 2020. Pelatro is also lowly rated on a multiple of 3.5 times ARR to enterprise valuation – software companies operating Software-as-a-Service models are generally rated on between eight to 10 times their ARR.

As the directors convert more contracts in their $16m pipeline into ARR, and revenue starts to be earned from the mobile advertising space, I expect Pelatro’s profits to scale up rapidly and the shares to make a concerted move towards my 100p fair value target to value the equity at £37m, or 10 times 2022 forecast cash profit of $3.5m.

From a technical perspective, a chart break-out above the October 2020 high (48p) would confirm that the base formation is complete to clear the path for a rally to the June 2020 high of 73p. Buy.

[toptomcat] 19/4/2021 17:55

Big gap up to Simon Thompson's target price of 100p. Had a nibble this morning and glad I did. Should move tomorrow.

[sphere25] 19/4/2021 09:14

Still stuck despite recent bullish noises from the company as well confirming confidence in full year numbers again today. Clearly further larger clear outs of stale bulls needed here.

Perhaps the presentation on Wednesday will help?

Either that or it might be down to Simon Thompson to drum more interest as per CTO today. It is proving a tough nut to crack at the moment.

All imo
DYOR

[rivaldo] 19/4/2021 06:11

RNS - another $0.5m of contract wins. With such high revenue visibility at $6.5m already this year, it's looking good for a beating of expectations against the current forecast of $7.2m:

[masurenguy] 15/4/2021 19:02

Pelatro target mobile phone AD market with potential to 'redefine ' the company

[paleje] 12/4/2021 22:17

Thanks riv.

So the ARR is slightly better than the 5.3m on which they rated fair value at 84p/share. And that is now contracted not estimated and we still have 3/4 of the year to go. But the exciting bit is the potential new advertising opportunity which isn't reflected at all.

Seems the market needs to see it to believe it, there are reasons, but if management keep producing the share price will respond eventually.

[masurenguy] 12/4/2021 14:13

Thanks for posting the Broker Note Riv.

[rivaldo] 12/4/2021 14:04

Cenkos say Buy and summarise as follows:

"Growing visibility leads to upgrade

The business model has been transformed by the focus largely on recurring customer engagements. The higher quality revenue base is accompanied by very strong growth prospects in both core and new markets. Increased revenue visibility means that we are upgrading our FY21E forecasts. Buy.

Robust FY20A. FY20A revenues of $4.0m (-41% YoY) were in line with January's trading update. The YoY contraction represents the move away from selling licences towards recurring engagements which defers revenue into future periods. Adj EBITDA of $0.4m (-85% YoY) was ahead of expectations and the movement similarly reflects the absence of profits from any licence recognition.

ARR +35%. The move towards engaging with customers on a recurring basis has led to very strong (+35% YoY) growth in run rate annualised recurring revenue (ARR) to $5.4m as at January. Total revenue visibility for FY21E now stands at over $6.0m.

Working capital improved. Net working capital was positive last year with an inflowof $2.1m versus an outflow of $1.1m, reflecting the changing customer engagement model.Trade and other receivables ended the year lower at $3.3m (-37% YoY). Placing proceeds of $2.6m helped cushion the net cash outflow pre financing activities of $2.3m. Net cash ended the year at $0.4m with gross cash balances standing at $1.8m.

Advertising opportunity. Pelatro has internally developed a product for the mobile advertising market based on its current data analysis and segmentation capability. We believe this supplementary market opportunity could be as material as that for the core business. This is a developing market and is not yet reflected in forecasts.

Upgrade. Revenue visibility of $6.0m, 46% above this time last year, supports an upgraded revenue forecast. We are conservatively moving our FY21E revenue forecast up 3% to $7.2m, with 83% visibility over this figure. Higher revenue and capitalised development costs this year produce a 38% EBITDA upgrade to $2.9m.

New FY22E forecast. With a conservative 12% growth forecast in for FY22E, the fixed cost nature of the business produces a 19% increase in EBITDA to $3.5m and, notably, a free cash flow neutral position which de-risks the investment. We forecast gross cash to end FY22E at $1.2m (net cash $0.4m).

FY21E growth. Rapid ARR growth, conservative forecasts and supplementary market opportunities underwrite the investment case. With free cash neutral position in sight and the stock trading on 3.5x EV/ARR in FY21E we are Buyers."

[sphere25] 12/4/2021 13:02

Ok so some positive movement on the results (+6%), but nothing to suggest a bullish market stance as yet. Price still range bound and well off the highs with a notable 239,500 exchanged at 39.2p.

This follows some of the prior notable trades:
200k @37.5p
300k @38.25p
315k @37.75p

The trade today just shows there are still sellers in size who want out regardless of the news here, even if it appears to be a new positive chapter for PTRO. The noises they are making suggest the future is bright and alot brighter than my small positioned risk averse stance here.

Clearly buyers in size are coming in to pick up these blocks of shares so an interesting one to keep a tabs of, to see if a demand imbalance can be caused at some point, and indeed if the improved outlook does transpire.

These are the main shareholders (as at 12th Jan 2001):

Bannix Management LLP* 12,993,553 35.09%
Chelverton Asset Management Limited 1,725,000 4.66%
Rathbones Investment Management 1,615,626 4.36%
Herald Investment Management 1,561,986 4.22%

It is only Chelverton who have moved via RNS in 2021 to cross 3% and hold 4.66%. Surely someone is going to cross another threshold with all these noteworthy blocks being exchanged.

As far as I can see it looks like Killik are the ones who have mainly been responsible for the selling here and were down under the disclosable threshold to 944k recently. Possibly all those need clearing out? I'm just speculating on who the main drag might be here.

Clearly the market in its entirety has been apprehensive, but if these buyers keep coming into pick up large blocks, it does become more and more interesting.

And now we wait to see if anyone with a mahooosive following does a bullish write up!

All imo
DYOR

[masurenguy] 12/4/2021 07:41

Results as largely expected. The key factor is their transformation from one-off to recurring revenue, which has now largely completed. It's now all about their readiness to exploit the future potential !

The Business

Mobile phones are ubiquitous and the significant penetration of smart phones (in developed countries as high as 80%, and in Asia for example currently about 50%) has opened up a new channel for advertising, namely mobile advertising. This segment is growing at a frenetic pace and currently accounts for about $100 billion globally. Communication Service Providers or CSPs are in a unique situation in this market as they hold the maximum amounts of data about their customers (who may number tens of millions and even hundreds of millions in some countries). This data, with appropriate consent and anonymity, can be shared with B2C players in financial services, retail, travel & hospitality, FMCG and brands to enable the latter to engage in targeted marketing of their products across advertising, campaigns, surveys, loyalty programmes etc. Such targeted campaigning will be contextual, relevant, personalised and real time. Pelatro's platform mViva, which handles such marketing for telcos using the vast quantity of data that it collects and processes applying AI/ML and other analytical techniques, is uniquely positioned to provide access to the segments mentioned earlier for mobile advertising and related activities.

Pelatro's strategy and readiness

Pelatro is now seeing various opportunities by partnering with its telco customers to enter this huge market. To start with, we have already identified six large markets where we have several telco customers using our software collecting and processing the data of about 700 million mobile subscribers. Out of these, about 350 million i.e. 50%, have smart phones. Our technology can help brands and B2C companies to target these 350 million subscribers and mViva's AI/ML capabilities will help us to differentiate our offering from that of the competition by enriching the data through deep analysis. Pelatro's strategy is to partner with our telco customers and sell this access to data to ad agencies who will in turn on-sell to their customers, who are the brands and B2C companies. These end customers will pay based on their usage (i.e. number of campaigns sent, targeting parameters used, number of people targeted etc.). This revenue is then shared by the ad agency, Pelatro and the telco, with a large portion being retained by Pelatro. This strategy therefore builds on our relationships with our telco customers, underpinned by the expansion of our existing business and with clear synergies between the two.

Looking forward

Your company has come a long way since its inception in 2013 and the IPO in December 2017. Apart from winning several Tier 1 telecom companies as customers in 17 countries, we have also built a strong foundation for the future. We will continue to build on this strong foundation to deliver superior results and shareholder value in the coming years.
Subash Menon, Managing Director, CEO and Co-Founder

Outlook

We ended 2020 in a much stronger position, with a substantial order book and good visibility over revenues for the coming year. Our mViva platform has been successfully stress-tested to the extreme in being implemented across a network of over 400m subscribers without any losses or fall out. We have been successfully selling our enhanced offering out across our customer base and reaching out to new customers. The start of the second phase of our journey into the mobile advertising space is particularly exciting as an area complementary to our existing operations. We have every confidence in meeting our customers' requirements, growing our business and meeting financial expectations for the year.
Richard Day, Chairman.

[rivaldo] 12/4/2021 07:33

That's a shame - I was hoping the MMs would mark it down on opening....

I was pleasantly surprised with a historic positive $0.4m EBITDA, and the outlook for 2021 looks most agreeable, with recurring revenues rising fast to a likely 80% this year and already not that much revenue needed to at least meet forecasts as paleje says.

The new mobile advertising product also looks like it has huge potential.

Cenkos have retained their Buy, and see $2.9m EBITDA this year rising to $3.5m nest year.

[p1nkfish] 12/4/2021 07:29

Requires a write-up. The wrong headlines from someone quickly scanning the results without thinking about it could do some damage. Certainly appears to have a positive business trajectory and ready to deliver.

[paleje] 12/4/2021 07:07

2020 numbers were never going to impress but they already have contracted revenues for current year of 6m, 5.2m of which is recurring so they're almost up to Cenkos' forecast for the full year with another 9 months to go. And a pipeline of ~16m.

Could do with an update from Cenkos or better still ST.

[sphere25] 07/4/2021 07:55

All gone quiet here.

315k mopped up at 37.75p, about 1% of the company with that print. Clearly the previous significant exchanges weren't enough to clear the sellers.

Any more for any more?

It's all about the results, anytime now:

"We anticipate releasing our results for the year ended 31(st) December 2020 in late March/early April 2021, although this may be subject to change given the disruption caused by local lockdowns."

Higher risk play at this end, but stable results and then it's a wait and see if ST tips it.

All imo
DYOR