Followed y'all over from the BII thread; you just can't get away, you guys!
First time I've looked at this one. Here, unlike BII, I actually may have something meaningful to contribute <g>. I spent 10 years with Epic Data in Vancouver (on the TSE, EDI (?)), and know lots of people in the industry and something about its (gasp!) fundamentals. Epic is a (now) $50 million (CDN) data collection vendor, the first and for some time the only SAP-certified one. Very good products.
I'd be a bit wary of the fundamental strength right now of this industry, mostly because the ERP industry seems to be tanking big time. PeopleSoft, of course, but SAP and - way worse - BAAN, all the biggies, are finding they've tapped the money's-no-object market and now have to go after the mid- and small/mid- market, where money is considered a lot more important. Companies like Epic and ADSN come in on the tails of the ERP systems to install electronic data collection as a component of a large implementation. So if ERP is tanking, I'd guess this business will see a growth curve trailing ERP in time (that is, it will dip behind ERP's dip).
Epic seems still to be pretty strong, but their Q1 (ended Dec) wasn't what it was supposed to be and they paid big: stock down more than 50%. They do say they've still got their biggest backlog ever, as I recall. And it's a very lucrative business, hardware aside (is hardware (*ever* lucrative these days?) Companies that drop $100 million US on an SAP implementation don't think twice about adding $4 million for data collection; it's chump change. And if they buy SAP or BAAN or Oracle's ERP they're used to paying big bucks and big margins.
IF (and it certainly is true I'm no expert and REALLY is true I'm not the *very* most successful investor) the sales of ERP go down and drag data collection with it, then it leaves ADSN fighting for market share against some pretty good competition: Epic, IBM (big in $$ but it's not a very important market for them), TekLogix (who has some REALLY good products and people!)...
And ADSN has $2million in revenue.
Now, reading this, it sounds like a classic short posting. I promise that's not the case, I have no monetary interest in this stock, short or long (and I won't, I think, even as a short term play, in spite of my undying gratitude to Waldo for BII). Just thought it might be useful to get an industry view of the industry. FWIW
EDIT: Sorry, forgot to wish you the sincerest best of luck and hope I don't end up kicking myself around the province if this thing goes for the sky...
WUWT |
