Global Axcess Corp (GAXC) Pre Earnings Blurb
Flash Player 9 or higher is required to view the chart Click here to download Flash Player nowGlobal Axcess (GAXC) will be reporting their Q4 2009 earnings next week. The numbers shouldn’t be surprising as it should be close to what they did in Q3 2009 even though Q4 is normally their weakest quarter. Year over year I expect Q4 revenues to be flattish with probably a 30% net income improvement. For FY 2009 i’m expecting revenue to be flattish with EPS of .07 for the year. I am going to be paying attention to the CC for what the RP (request for proposal) backlog is for the ATM business and also the new DVD kiosk initiative. I expect 2010 to be a breakout year for the company highlighted by H2 2010 revenue and net income improvements from the ATM side as well as revenue/net income contribution from their DVD initiative. My cost basis is around 80c on my position and looking to add around those levels if I can.
Disclosure: LONG GAXC
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Thanks Ian,
Here’s my analysis as a best case
Flat revenues but with higher margin using % from q3 09 of 47.5% (this is because the Fed dropped the rate to zero in mid Dec 08 so q3 09 is a better #) This yields increased margin of $71k.
Using q3 09 interest of $147k, this gets reduced by $6,300 due to them paying off $360k principal per qtr on the Suntrust loan. So net interest savings from Q4 08 to adjusted Q3 09 is $123k
total improvement over q4 08 of $331k plus $123k is expected $525k
Of course this doesn’t include any ramp up loss on the DVD kiosks
So we could see maybe $500k
What do you think ?
Thanks, Tom
Tom:
Yeah looks pretty spot on, I was guessing 450,000 in net income taking into account a small loss from the dvd pilot plus maybe some added consulting fees ie the new DVD consultant or two.
IC
I have a feeling you will be able to pick up more shares at .80 cents Ian. Not that this stock has had much of a run-up into earnings, but I believe many are waiting for the earnings before they sell and I think the earnings will be a non-event (meet expectations or slightly below). I’m not a basher, I like the company. Frankly I’m hoping for a very short term drop to give us another excellent entry point.
However… I still don’t think this will be the stock that will make up for our EGMI losses (shorter term). So keep looking for that next great idea!
Thanks for your work-
Fletcher
Oh I think I can make the money back and then some on this. The EPS can ramp real quickly here with a few wins..
IC
Have you seen the numbers wholly smokes record net income outstanding! Will be looking into further looks real good first glance.
Just kidding, record net income though.
You have to take out the one time gain, but it was still record net income. Pretty much right inline with what I thought, actually a little better on revenues in Q4. Also surprised they actually gave guidance as this management team is ultra conservative.
IC
Looks like GAXC is growing the business nicely Ian.
Don’t know how much more of this your going to get at.80.