ERD - ERoad. (Transport sector technology)

[Hawkeye]

Read an interesting article in the printed NBR today about Eroad looking to make $40million in an august IPO, more info coming to light in the middle of July.
Yet another tech stock, but this one seems to be onto a winning idea making technology for fleet tracking and road user charging, and already has NZ couriers, Mobile, PBT and Mondaile signed up, plus some more in Australia and America, 1100 all up.

Could be one to watch

[dingoNZ]

I like this look of this an am looking forward to crunching some figures when the prospectus come out. I don't know a lot about these guys but their idea seems to be an awesome tool for industry, will have a wee read about it over the weekend and report back!

[Harvey Specter]

I will be interested to see how they can take this global. Do other countries have similar road users schemes?

[blobbles]

Prospectus out:
https://d2ikaws505454x.cloudfront.net/eroad/02/pdf/EROAD_Prospectus_18Jul14.pdf

[blackpixiez]

Article following prospectus on potential risks of competition: http://www.stuff.co.nz/business/industries/10282781/Rivals-a-big-risk-to-Eroad

[benjitara]

I actually like the product but for me the company valuations are extremely high given projected revenues. 16% projected margin on revenue seems too high as well. I think i'll wait this one out and see if the market corrects the float price.

[Hawkeye]

I actually like the product but for me the company valuations are extremely high given projected revenues. 16% projected margin on revenue seems too high as well. I think i'll wait this one out and see if the market corrects the float price.

Im in the same boat as you, IPO is a little bit expensive for my liking. If they go cheaper ill look at them then.

[benjitara]

Im in the same boat as you, IPO is a little bit expensive for my liking. If they go cheaper ill look at them then.

Oregon seems to be the crunch point here. I noted that the revenue increases were slowing in New Zealand too...although I would say that adoption of Road user charges worldwide is something that will have to accelerate with the increase in world freight volumes. so macro features favour them.

[Schrodinger]

Yep a lot of the recent IPOs are on high valuations. Ultimately if the company grows it's probably not hugely important but it does leave a bad taste in the mouth overpaying for a stock.

[elZorro]

Yep a lot of the recent IPOs are on high valuations. Ultimately if the company grows it's probably not hugely important but it does leave a bad taste in the mouth overpaying for a stock.

e.g. Glass Earth obtained $25mill or so, in their IPO. They did manage to stretch it out for a few years with some topups. Only a few years though.

At least E-Road has a revenue stream.

[BlackPeter]

interesting analysis in NBR. In a nutshell: interesting company, but ways too dear considering earnings and competitive risks:

http://www.nbr.co.nz/article/eroad-valuation-could-be-bridge-too-far-investors-weekend-review-md-p-159689

[RGR367]

Yeah, it's still expensive now that the confirmed IPO price is at 3 bucks. But I'm willing to set aside a small amount just to get to know the company from the start. Just been my way of knowing any stock that I'll be willing to hold long term. Hoping I'll be right ......

[horus1]

I will buy some to get in from the start

[Harvey Specter]

Anyone in on ERoad. Seems to be one of the better IPO's recently. Will it hold up?

[RGR367]

No - far too expensive. Who knows when - but it will crash at some point. That's not to say it won't go on a crazy geo op style upwards ride first.

Crazy kiwi saver funds be crazy.
I was planning to but I let my my funds got caught in the way down ride of XRO instead.

[benjitara]

I've got this stock around 45% overvalued at the moment for my liking and thought a $2 price would have been around about right. For a company with 9 million revenue it's hard to comprehend the current share price. each to their own...

[noodles]

I've got this stock around 45% overvalued at the moment for my liking and thought a $2 price would have been around about right. For a company with 9 million revenue it's hard to comprehend the current share price. each to their own...
Clearly you have been too conservative with your DCF model. I think most people who use DCF subconsciously input the numbers they know will confirm their opinion of the stock. So if in fact you did use DCF, perhaps you didn't really want to buy eROAD in the first place?
DISC: annoyed I missed out on the IPO after my broker suggesting I buy.

[benjitara]

Clearly you have been too conservative with your DCF model. I think most people who use DCF subconsciously input the numbers they know will confirm their opinion of the stock. So if in fact you did use DCF, perhaps you didn't really want to buy eROAD in the first place?
DISC: annoyed I missed out on the IPO after my broker suggesting I buy.

I go on "owners earnings" rather than DCF models... I like the company and sector but can not invest at current levels.

[Schwarzwald]

I have undertaken the following analysis from public sources. All estimates are approximate, should not be relied upon and investors should do there own research.
Eroad is engaged in the provision of cloud based softwareusing GPS and telematics to optimise transport fleet performance. The company’ssoftware allows the recording and collection of Road User Charges (RUC) a taxbased on mileage travelled. This later capability is important indistinguishing Eroad from other telematics based businesses. The concept ofusing GPS based systems to monitor vehicle and driver performance has existedfor some time.
Eroad in its prospectus claims to have only one competitorin the electronic RUC market in New Zealand. Examining the telematics market the extent of competition would appearto depend on how the market is defined with the ability to measure and collectRUC a critical point of difference. Researching the transport fleet managementsoftware market the following businesses appear to be participants in NewZealand:
Smartrak;
Amtrax;
Xlerate Technologies;
GPSworld;
Gofleet;
Imarda.com;
International Telematics.
The scale of the New Zealand operators varies. Imarda andInternational Telematics appear to be the larger New Zealand based businesses.Imarda NZ is engaged in the manufacture and distribution of telematics hardwareand software solutions. For the year to 31 December 2012 Imarda NZ had revenueof NZ$5.3 million down from 2011 when revenue was NZ8.4 million (note this maynot be representative of the full group). Imarda has offices in New Zealand,Australia, and the USA. Imarda was founded in 2007. The business claims to havemore than 100,000 mobile hardware units and to include Woolworths Australia andBoral Australia fleets together with one of the world’s largest freightcarriers in the US as customers.
International Telematics was established in 2005 and isbased in Penrose. It designs hardware and software to deliver its fleetmonitoring and management system. International Telematics began North Americanoperations in 2008 and has offices in Auckland, New York, Melbourne andrecently Colorado. It is suggested that International Telematics has 15,000units active including 7,000 in North America.
Internationally the use of GPS to monitor transport fleetperformance also appears to have developed rapidly. Internationally thefollowing companies are identifiable as broadly operating in the GPS/Telematicsspace:
Navman Wireless;
Mixtelematics;
Inthinc;
Wireless Matrix (acquired by CalAmp March 2013);
Trimble;
Digicore;
FleetBoss Global Positioning Solutions;
Teletrac Inc;
Masternaut;
Fleetmatics.
Teletrac is a 25 year old Southern California company.Teletrac claims to automate 20,000 fleets, 200,000 vehicles in 87 countries andto have 500 employees.
Masternaut claims to be Europe’s largest telematics solutionprovider with 10,000 customers, 600 staff and 300,000 assets (vehicle deployments).Masternaut is a joint venture between Summit Partners and Fleetcor TechnologiesInc.
Mixtelematics is listed on the Johannesburg (JSE) and NewYork Stock Exchanges. Mixtelematics has subscribers in 112 countries, 900 plusemployees and as of Q1 2015 462,700 vehicle subscriptions. Mixtelematics estimates that the globalmarket for GPS/telematics is 333 million vehicles and that 2013 marketpenetration is 4%. Mixtelematics estimates that there is a potential market of33 million vehicles in South Africa and Brazil, its largest markets. Thecompany believes that globally there are less than 10 providers with more than300,000 subscribers. As a public company financial guidance is available and pricingratios can be derived. In Q3 2014 Mixtelematics achieved an EBITDA ratio of21.4%. In its most recent quarter the EBITDA margin reduced to 16.3%. For 1Q2015 the company had US$78.2 million incash on hand. Guidance for FY15 revenue is US$130 million to US$132.6 millionand for adjusted EBITDA to be between US$27.8 million and US$28.7 million (21%EBITDA margin).Full year eps guidance is 17-18 South African cents. Thesetranslate into a prospective PE of 22-23 times and an EV/EBITDA ratio of 8.5x. Theprospective EV/revenue ratio appears to be around 1.8x.
Digicore is also listed on the JSE and states that it has1000 employees and 700,000 systems sold. Digicore is yet to report for the 2014financial year.
CalAmp is a more broadly based machine to machine (M2M)telematics company focussing more widely than heavy transportation fleets.CalAmp states that it has 400,000 application subscribers and 3 million devicesunder management. The current market capitalisation is around US$636 millionand the company had net cash of US$28.3 million giving an enterprise value ofapproximately US$608 million. CalAmp achieved an EBITDA margin of 12.4% in FY14somewhat lower than that of Mixtelematics. FY14 revenue was US$236 millionproviding a historical EV/revenue of 2.6x. Based on FY14 EBITDA of US$29.3million the historical EV/EBITDA ratio was 20.8x. The company stated that itexpects 2015 financial performance to be similar to 2014. Consensus analystforecasts for 2015 however are US$1.15 per share placing CalAmp on aprospective PE of 15.4x.
Particularly prominent in the GPS/telematics space is listedFleetmatics Inc based in Dublin and Boston. Fleetmatics has experiencedexplosive growth and provides a comparative for Eroad given its North Americanaspirations. In addition to the British Isles and North America, Fleetmaticshas entered the Netherlands, Mexican, Mainland Europe and Australasian markets(acquiring Connect2Field based in Sydney). In August this year Fleetmaticsachieved 500,000 vehicles under subscription with 23,000 customers as at 30June. In June the company acquired KKTSrl provider of ‘Routist’ an Italianvehicle routing optimisation technology. Fleetmatics GPS tracking andmanagement tools provide location, fuel usage, speed and mileage data and thecompany sees growth in fuel cards, driving style, Garmin and driver logfunctionality. Fleetmatics expects the fleet management market to grow fromUS$10.9 billion in 2014 to US$30.45 billion in 2018. Fleetmatics estimates 71million vehicles in North America, Europe, Latin America and Australasianmarkets with a potential revenue value of US$33 billion annually (this perhapssuggests a smaller potential global market than that of Mixtelematics).Currently (August 2014) Fleetmatics estimates its addressable market to be 31million vehicles and this market to be penetrated to 12.1%. Fleetmatics ownsubscriptions of 500,000 would therefore represent around 1.6% penetration with10.5% provided by competitors.
Fleetmatics derives 92% of its revenue from North Americawith 78% of sales in Q214 coming from web sales. Web sales are generally madeto fleets of 1 to 75 vehicles. Field sales representatives make sales to fleetsof 75 to 500 vehicles and enterprise sales account for sales to fleets inexcess of 500 vehicles. Average monthlyvehicle cost is US$40 per month which with current subscription levels suggestsFleetmatics is on track for annualised revenues of US$240 million excludingchurn. Fleet churn was 7.9% for FY13. In Q2 FY 14 this had fallen to 1.1%.Fleetmatics is targeting an EBITDA margin of 28% in 2015 and has stated thatits long term EBITDA margin target is 30-35%. Research and development relativeto revenue in recent years has been 6-7% and the long term target is 5-6%.
Fleetmatics guidance for the current year is for revenue ofbetween US$228 million and US$229 million. EBITDA guidance is for betweenUS$62.89 million and US$65.3 million with eps of US$0.82 to US$0.87. Thecompany had debt of US$23.8 million at its most recent result. Fleetmaticsprospective PE ratio based on guidance is approximately 38x. The prospectiveprice to revenue is around 5.5x. It appears that Fleetmatics prospectiveEnterprise multiple based on guidance is around 17.5x.
Eroad has projected FY15 EV/EBIT of 223x to 300x and forFY16 21.9 to 29.4x. Eroad anticipates its PE ratio for FY15 to be between 182xand 230x and for FY 16 between 33x and 41x. The prospectus projects Price torevenue of 7.3x to 9.9x in FY15 and in FY16 4.1x to 5.5x.
Eroad anticipates a low level of churn based on projectedFY15 retention of 98.2%. Based on prospectus information Eroad’s EBITDA marginis running between 40% (FY14) and 26% (FY15). This statistic may be influencedby the degree of deferred revenue released and the extent to which research anddevelopment expenses are capitalised. The extent to which research anddevelopment expense grows relative to revenue beyond the prospectus projectionsis critical to valuation outcomes as is the growth in sales and marketingexpenditure relative to the absolute level of sales growth. While the global market for GPS/telematicsappears to be vast and still underpenetrated Eroad’s particular niche of RUCvehicle jurisdictions is considerably smaller. Eroad has identified theimportance of retention of revenues and recurrence at defensible margins as keyqualitative factors in the valuation of the cloud based company. In additioninvestors also need to take into account the importance of incumbency in nonRUC markets and the benefits of first mover advantage in achieving mass andmarket recognition.
Hope this helps investors with their own analysis of the business.
Disclosure - not holding.

[Harvey Specter]

Good research. While there are only 2 RUC registered companies at the moment, I wonder how hard this will be for other cos to get if the market demands.

The issue in the industry is fragmentation as show by all the companies you found. I note Imarda was looking to IPO a few years ago and use some of the proceeds to buy other small companies (ie. Customers). If you read all the material, it's not hard to guess their big undisclosed US customer is FedEx, plus a couple of biggies in Oz too.

[Pricey]

There is interesting support for this stock. I note that Commonwealth Bank (through its subsidiaries) took a substantial shareholding of 5.19 per cent early in October. Ever since the IPO I've been following Peter Lynch's mantra that its better to miss the first stock move and to wait until the company has duplicated its success in more than one country, to prove that expansion will work. I wonder what's motivating everyone else?

[klid]

Half year results pretty good.

Highlights
- On track to deliver a full year results in line with Prospectus Prospective Financial Information (PFI)
- Units on Depot 18,586 up by 79% since 30 September 2013
- Revenue at $7.9m up by 82% on same period last year
- Annualised Recurring Revenue reaches $16.0 million, up by 72% since 30 September 2013
- Customer Retention Rate remains strong at 99.2%
- Net Profit before tax and costs of listing $0.1 million, up compared to a loss of $0.4 million for the same period last year
- Opened new office in Portland, Oregon

[Dej]

Anyone still following this?

Based upon comments from members here it seems that people would think that the current $4 is even more overvalued than the IPO.

[BlackPeter]

Anyone still following this?

Based upon comments from members here it seems that people would think that the current $4 is even more overvalued than the IPO.

Who knows - maybe EROAD senior management is reading this thread ... and trembling in their boots. The weaker ones are already voting with their feet:


Date this disclosure made: 16 June 2015
Date of last disclosure: 9 June 2015
Director(s) or senior manager(s) giving disclosure
Full name(s): Brian Michie
Name of listed issuer: EROAD Limited
Name of related body corporate: Not applicable
Position held in listed issuer: Senior Vice President
Summary of acquisition or disposal of relevant interest (excluding specified
derivatives)
Class of affected quoted financial products: Ordinary shares in EROAD Limited
(NZX code: ERD)
For that relevant interest,--
(a) number held in class before acquisition or disposal: 2,072,966
(b) number held in class after acquisition or disposal: 1,976,177

and


Date this disclosure made: 18 June 2015
Date of last disclosure: 15 August 2014

Director(s) or senior manager(s) giving disclosure

Full name(s): Peter Graeme Batcheler
Name of listed issuer: EROAD Limited
Name of related body corporate (if applicable): Not applicable
Position held in listed issuer: Executive Vice President - Global Sales
Summary of acquisition or disposal of relevant interest (excluding specified
derivatives)
Class of affected quoted financial products: Ordinary shares in EROAD Limited
(NZX code: ERD)
Nature of the affected relevant interest(s): Peter Batcheler has the power to
control dealings and voting of shares held by SW Trust Services (Twelve)
Limited. SW Trust Services (Twelve) Limited is the registered holder of the
securities in respect of which a relevant interest has been disposed.

For that relevant interest,--

(a) number held in class before acquisition or disposal: 2,379,851
(b) number held in class after acquisition or disposal: 2,141,865


But on the other hand - if I look at the fundamentals ... (Sort of-) SW startup with already positive earnings (predicted EPS 6 cents) and quite healthy growth rate (CAGR = 58%). Applying the Graham formula do they still look undervalued (obviously unless the directors / execs know something they don't tell the market).

Why would you say this stock is overvalued?

[BlackPeter]

Sounds like another good idea for companies to use E-road equipment, safe money and make our roads safer:

https://www.nzx.com/companies/ERD/announcements/269243

Like it - Win-win-win

Discl: holding (otherwise it would be just "win-win";))

[Yoda]

What happened to this? SP 2.33? That is so scary. A big warning of what mr market can do. Got to watch those MA,s . Any ideas.....?

Not holding , out at 4.10

[axe]

this happened :eek2:

https://www.nzx.com/companies/ERD/announcements/270837

DISC not hold/held

[BlackPeter]

What happened to this? SP 2.33? That is so scary. A big warning of what mr market can do. Got to watch those MA,s . Any ideas.....?

Not holding , out at 4.10

Look at the volume ... hardly any shares moved. The whole peak down reflects less than 200k shares (i.e. 0.33 % of all issues shares) traded over one week.

I guess some people got spooked by the boards decision to invest heavily into their US sales team in order to accelerate the US roll out instead of making a larger profit in FY2016. Their EBIT prediction for 2016 is still positive, but much lower now:

https://www.nzx.com/companies/ERD/announcements/270837

While in normal times the market would see this decision as positive - the current market is quite jittery and given that this share is not heavily traded, it just dropped like a stone on a small number of small sellers.

However - they might have found their new bottom - today's volume appears to be much stronger (the first hour of today's trading covers already half of last weeks total volume) - and price slowly rising again. Time to buy?

Discl: missed last week the opportunity to get out prior to the announcement ... and think (after revisiting their last financial report) that the share is at current price good value - i.e. cancelled my sell order this morning and thinking about buying some more ...

[benjitara]

http://www.sharetrader.co.nz/images/misc/quote_icon.png Originally Posted by benjitara http://www.sharetrader.co.nz/images/buttons/viewpost-right.png (http://www.sharetrader.co.nz/showthread.php?p=498617#post498617) I've got this stock around 45% overvalued at the moment for my liking and thought a $2 price would have been around about right. For a company with 9 million revenue it's hard to comprehend the current share price. each to their own...

Pleased I followed up thoughts. Might be a buy in opportunity if Oregon ever starts producing decent numbers...

[Fisherking]

[QUOTE=benjitara;610061]http://www.sharetrader.co.nz/images/misc/quote_icon.png Originally Posted by benjitara http://www.sharetrader.co.nz/images/buttons/viewpost-right.png (http://www.sharetrader.co.nz/showthread.php?p=498617#post498617) I've got this stock around 45% overvalued at the moment for my liking and thought a $2 price would have been around about right. For a company with 9 million revenue it's hard to comprehend the current share price. each to their own...

It's about their growth prospects, particularly with the law changes in the US

[Ace]

ERD seems to have some promising prospects and I have been contemplating getting in before the recent announcement regarding the California Road Charge Pilot with Caltrans.
In response to benjitara, as many people have mentioned the share price includes a large premium for the potential ERD provides and their current foothold in their respective market, that being said there are a few things you all might find interesting, I know I did.

What I found interesting is that ERD has a few competitors in the US, and would like to discuss a few statements made by ERD, firstly, "Caltrans selects EROAD as technology provider to California Road Charge Pilot". What they failed to mention is that there are three other firms that were selected for the California Road Charge Pilot, including Azuga, Intelligent Mechatronic Systems Inc. and a state-run service supported by Arvato Mobility Solutions. Although EROAD was selected to service heavy vehicles in the pilot - which is ultimately their forte. That being said, it does not in anyway discredit from EROADs achievement and success in tapping into the North American market especially with regards to getting a strong foothold before the US fed. mandate takes full effect - and it still currently it appears that they are one of a few ELD/WMT providers for heavy vehicles, just a word of caution regarding the level of optimism seen here derived from the announcements.

Another statement which captured my attention was a statement made around the time of the November announcement regarding the US Federal Mandate, "We currently expect EROAD to be the only ELD provider able to offer customers both ELD services and Oregon WMT services." They may be the only ELD provider to provide ELD services AND Oregon WMT services, however they are NOT the only company to provide ELD services OR WMT services. Personally, I found that the statement had no reason to be there other than to imply that they are the 'only' provider for these services which isn't the case - they are the only provider for BOTH services. A little bit of semantics here but I thought I'd mention it.
Regarding IMS, they have also been awarded a Road User Charge contract from Oregon state mid March last year limited to light duty vehicles (cars and trucks), and I don't think there's anything stopping them from tending to heavy duty vehicles as IMS also offers fleet management, RUC and a whole range of other services. They are even tapping into US insurance companies to provide them with data and information about drivers which can then be used to calculate premiums however there appears to be a clout of negative press regarding the use of IMS's DriveSync and light duty vehicles.

With all that being said I still believe EROAD has amazing potential for growth and expansion especially into the North American market and their niche for heavy vehicles.
Theres a whole lot of other things I'd like to post but I won't bore you all to death and I'm getting tired haha. I have attached some of the articles for reference below and hope you might find them useful.


Interested to hear your opinions,
Ace.

http://www.dot.ca.gov/hq/paffairs/news/pressrel/2016/16pr019.htm
http://www.itsinternational.com/categories/charging-tolling/news/oregon-debuts-road-user-charging-to-fund-transportation-projects/

[emveha]

What I found interesting is that ERD has a few competitors in the US, and would like to discuss a few statements made by ERD, firstly, "Caltrans selects EROAD as technology provider to California Road Charge Pilot". What they failed to mention is that there are three other firms that were selected for the California Road Charge Pilot, including Azuga, Intelligent Mechatronic Systems Inc. and a state-run service supported by Arvato Mobility Solutions. Although EROAD was selected to service heavy vehicles in the pilot - which is ultimately their forte. That being said, it does not in anyway discredit from EROADs achievement and success in tapping into the North American market especially with regards to getting a strong foothold before the US fed. mandate takes full effect - and it still currently it appears that they are one of a few ELD/WMT providers for heavy vehicles, just a word of caution regarding the level of optimism seen here derived from the announcements.

It might be worth noting that in the California road charge pilot, only 50 vehicles (out of 5000) are trucks. Is that the extent of EROAD's participation?

http://www.californiaroadchargepilot.com/wp-content/uploads/2016/03/Demographic-Matrix.png

[winner69]

Is this announcement good or bad?
https://www.nzx.com/files/attachments/245046.pdf


Share price nothing to write home about at the moment

Worth while having a closer look at? Might be really cheap?

[percy]

Is this announcement good or bad?
https://www.nzx.com/files/attachments/245046.pdf


Share price nothing to write home about at the moment

Worth while having a closer look at? Might be really cheap?

Well the market did not seem to like the announcement.The sp is down 16 cents today.8.6%.
The present downtrend remains intact.
Again testing Feb's $1.70.
Volume through at $1.70.Buyer for 3,000 at $1.52.

[BlackPeter]

Is this announcement good or bad?
https://www.nzx.com/files/attachments/245046.pdf


Share price nothing to write home about at the moment

Worth while having a closer look at? Might be really cheap?

Well, I sold out some time ago after management did that as well ... and was proven quite right in doing so;);

I think key is the following sentence:

with the Established Market ahead of expectations and the Commercial Market behind expectations.

Just try to decipher the announcement based on my fading memories of this company - they had already a quite good stand in NZ and ok-ish in Australia ("the established" market) and seem to have made some more progress in that (which is good). However - the "pie in the sky" is the US market (which they call for some reasons "Commercial Market"). Given that they used to pump millions into this market are 800 more subscribers in a market 100 times the size of NZ not overwhelming. Looks like progress in the US is slower than they wished for ... and they really need the US to grow to make their plans reality.

The other thing is ... analysts (no doubt based on company data) predicted a forward CAGR of above 60%. If their growth in the first half was only 18% (I know, its a crude measure, given that they just indicate the growth in contracted units, which is not all of their business), than they need to hurry up to reach the above 60% for the full year).

So - on a first impression and without lots of analysis would I say, it is great that they start reporting on some measures. They might have as well enough revenue to not require another CR (obviously depending on how much they currently pour into the US) ... but the numbers are likely to underwhelm the markets.

By all means - look into the company, but I don't think there is a rush to buy - though spec stocks can obviously bounce all around the place without a good reason.

Overall - I think it is an interesting company ... and they are on Chris Lee's radar as well (though not sure, whether he puts them at current into the "good" or the "not sure" basket). However - management sort of inexperienced with running a public company - and I was annoyed when management sold their shares prior to announcing a quite significant profit downgrade (obviously clever, but leaves a sour taste in the mouth)

DYOR;

Discl: don't hold;

[winner69]

Interesting that a few days ago there was a reallly high volume day .......and the share price fell 15 cents

Just saying

[axe]

No worries winner. ERD looks like it has a great product and a big potential market to go for. I have talked to a few truckies who have the product installed and feedback has been good.
Just watching and waiting for the downtrend to end. Don't hold but watching...



Interesting that a few days ago there was a reallly high volume day .......and the share price fell 15 cents


Just saying

[Scooter]

Overall - I think it is an interesting company ... and they are on Chris Lee's radar as well (though not sure, whether he puts them at current into the "good" or the "not sure" basket). However - management sort of inexperienced with running a public company - and I was annoyed when management sold their shares prior to announcing a quite significant profit downgrade (obviously clever, but leaves a sour taste in the mouth)


What does he know!, he has been involved in some bad investments over the years just like the rest of them and then tries to come out squeaky clean. Sth Canterbury Finance being one. The only thing he is good at is trying to make up what sounds to be a legit story only to be found factually incorrect. See his recent ramblings on Martin Hawes where he has had to rescind his comments. LOL

[percy]

What does he know!, he has been involved in some bad investments over the years just like the rest of them and then tries to come out squeaky clean. Sth Canterbury Finance being one. The only thing he is good at is trying to make up what sounds to be a legit story only to be found factually incorrect. See his recent ramblings on Martin Hawes where he has had to rescind his comments. LOL
Agree with your comments,however I do not know of one commentator whose "future" comments have been 100%.Most commentators such as Brian Gaynor work on historical facts.And yes Lee tries to cover his mistakes.
I actually enjoy his news letter.
Back to Eroad.Not a great announcement today that the Financial director is leaving.Often seen as a warning signal.
ps.I would not seek financial advice from Martin Hawes,well not sharemarket advice.

[BlackPeter]

Hmm - interesting: So they made an announcement commenting on their share price (https://www.nzx.com/companies/ERD/announcements/290395), flag this announcement as "not price sensitive" and the SP goes up by 20% - what is wrong with this picture?

[winner69]

NZ punters are slow to catch on and should have read the original announcement mor thoroughly

NZX should issue a speeding ticket I reckon

That trade of 100,000 signals confidence

[axe]

NZ punters are slow to catch on and should have read the original announcement mor thoroughly

NZX should issue a speeding ticket I reckon

That trade of 100,000 signals confidence

The Board reckons the share price doesn't reflect the performance and value of the company. Why are the Board members not scooping up shares at these bargains prices.... ?

Guess they probably all in a lock up pending the results in november.

[sb9]

Its always bit of worry when a company has to explain punters how undervalued their sp is relative to company's performance....hmmm!!!

[winner69]

Its always bit of worry when a company has to explain punters how undervalued their sp is relative to company's performance....hmmm!!!

It worked though

[sb9]

It worked though

A day's trading of whopping 160k odd shares...will wait and see

[winner69]

A day's trading of whopping 160k odd shares...will wait and see

If you take out the recent really high volume days (~1m odd shares) yesterdays 185,000 shares was way above daily average

Yes wait and see - might be 200 today or might be 150, who knows

Interesting that the recent 1,300k and 900k volume days the share price fell (significantly) - a keen seller?

[sb9]

If you take out the recent really high volume days (~1m odd shares) yesterdays 185,000 shares was way above daily average

Yes wait and see - might be 200 today or might be 150, who knows

Interesting that the recent 1,300k and 900k volume days the share price fell (significantly) - a keen seller?

Could well be, don't really follow this stock. My observations were more around the fact that company has to blow its trumpet to drive up sp, which is not normal trading practice for many companies.

If you're doing a good job around fundamentals, the sp will take care of itself.

[winner69]

Latest stats
https://www.nzx.com/files/attachments/251129.pdf

Suppose 'broadly in line with Eroad's expectations' means the stats are pretty good

[Pricey]

In my mind "broadly" implies the stats aren't quite as expected. Not too impressive considering TCU forecasts have already been downgraded dramatically - twice. Original forecast (US) was for 12,440 TCUs by 31 March 2016, revised down again to between 6000 - 6000 by March 2016.

This company seems way off (at this stage) and terrible at predicting the market they operate in. Teething, perhaps.

[kiwi_crusader]

Nice little ride lately, finally picked a stock at the bottom of a dip! :t_up:

[Leftfield]

Nice little ride lately, finally picked a stock at the bottom of a dip! :t_up:

Congrats! Price chart looks attractive, however fundamentals make it look expensive. Would you care to share what you like about the company's prospects.

[kiwi_crusader]

Heard a rumor from a mates mate from the U.S that there is a lot of interest going on in the states about this product in the transport industry and with the new laws regarding Electronic logging device's this year, sales are about to explode.

[freebee]

Yes the ELD is a very good product from Eroad. The big question is will they get good market penetration in the US. With all of the political talk about USA made products getting preference, there could be some hoops to jump through if a good locally produced ELD comes to the market in next few months. ERD has massive market share in NZ but for the SP to rise long term, they have to nail that USA market. I like ERD, have sold recently on small upswing, watching with interest...

[Leftfield]

Thanks for sharing and good luck to holders. Watching with interest.

[bullfrog]

Been watching this company for a while. I understand their business model, and believe they are executing it competently, and note they are building relationships with their user base = loyalty. The only worry is whether they have the right management team to handle what hopefully will be exponential growth in the US. As a shareholder I'm watching their growth strategy very closely, with fingers crossed.

[Pricey]

According to management sales have meant to have exploded ever since their IPO - this company has consistently underperformed. What has changed since January 23 to justify a 34% increase in price??? There has been no update to prove they are executing according to their (revised down, revised down, revised down) plan. B. Graham's lesson about not investing in a company expanding into new markets until it proves it can successfully replicate its strategy, has saved me a lot of money on this one. I'm still interested, just don't have confidence in it yet.

[freebee]

A couple of naughty boys at Eroad, no reflection at all on this good company but not the headline management want to see.

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11814891

[kiwi_crusader]

With over 30 million trucks and buses in the the U.S and at $30/month for an Eroad device, that's a lot of $000's even if 1% of the market goes with Eroad.

http://www.eroad.com/us/landing/eld/

http://www.trucking.org/News_and_Information_Reports_Industry_Data.aspx

[Hectorplains]

With over 30 million trucks and buses in the the U.S and at $30/month for an Eroad device, that's a lot of $000's even if 1% of the market goes with Eroad.

http://www.eroad.com/us/landing/eld/

http://www.trucking.org/News_and_Information_Reports_Industry_Data.aspx

So far they've have cornered 0.0003% of that market. They reported Mar to Ded sales of just under 1200 'total units' - a respectable sounding 26% increase. Until you attach the approximate dollar value of those sales. NZ plans range from $12 to $72 a month.

[itm]

https://www.nzx.com/companies/ERD/announcements/300208

Published yesterday afternoon. Strategic timing for bad news?

30% growth in total contracted units since last year, but "is likely to post, for its full financial year, a loss larger than the prior year". Some of it is due to changes in accounting estimates.

One guess as to the direction of the share price in the short-medium term...

[kiwi_crusader]

Some good news for Eroad in the U.S. No stopping eld's now, hopefully see some strong sales coming in now before December.

http://www.overdriveonline.com/eld-challenge-wont-be-heard-by-supreme-court-ending-ooida-bid-to-overturn-mandate/

[freebee]

Looks like Eroad have invested hard in developing a very good ELD in NZ and US over the last few years ,now it's time to focus on US sales and return on investment.If those US big fleet operators choose Eroad this will pay off big time.
http://dieseltalk.co.nz/news/redundancies-eroad-restructures-growth

Good move to have their ELD independently verified too:

https://www.nzx.com/files/attachments/260996.pdf

[kiwi_crusader]

Good to see they getting really proactive in the States attending lots of trade/truck shows and sponsorships. A big fleet co like Swift with 20,000 trucks would be awesome.

https://www.nzx.com/files/attachments/261127.pdf

[percy]

CTO.Bruce Wilson.
Here today,gone tomorrow.???????????????????????????

[tread]

Hi there - new here. Just bought a parcel a couple of weeks ago, and another - timed well luckily, the day before the recent quarterly sales announcement. Looking to hold these now and see where we go. Looks like a good product and model to me - will see what adoption looks like in the US market.

Anyway, greetings.

[cdonald]

yes, have been watching the shareprice for the last few days, sadly just watching rather than having skin in the game. I do find it a little bit distressing when your CTO is effectively removed. Thats either poor reporting or something that warrants dismissal. Will be interesting to see where he ends up, hopefully not with the opposition.

[Fisherking]

Hi there - new here. Just bought a parcel a couple of weeks ago, and another - timed well luckily, the day before the recent quarterly sales announcement. Looking to hold these now and see where we go. Looks like a good product and model to me - will see what adoption looks like in the US market.

Anyway, greetings.

Great timing. Hang in there, if the US kicks off it will go crazy.

[kiwi_crusader]

Maybe the U.S not going to kick off just yet

http://m.fleetowner.com/regulations/delay-eld-mandate-leading-transportation-attorney-says-not-likely

[BlackPeter]

Maybe the U.S not going to kick off just yet

http://m.fleetowner.com/regulations/delay-eld-mandate-leading-transportation-attorney-says-not-likely

Well, I guess let's face it - the lame duck Trump government is despite a majority in congress and house not even able to push through the legislative changes it promised (health care, tax reform) ... and here we expect them to focus on a change which would increase cost for industry and benefit some obscure alien company? Yeah, right ....

[kiwi_crusader]

http://m.fleetowner.com/driver-logs/eld-makers-frustrated-congress-urge-truckers-not-wait-until-december-deadline

Surge in demand coming.

[freebee]

Thanks for sharing Kiwi, very good article and great to see Eroad quoted several times as perhaps the authority when it comes to ELD's. As you say,it's looking very promising for a big surge in demand and a big year for Eroad coming up.

[kiwi_crusader]

ELD's for Canada on its way as well.

http://m.fleetowner.com/driver-logs/canadian-truckers-await-their-own-eld-mandate

[kiwi_crusader]

Wondering why there has been interest in ERD lately. This company is slow in given out announcements. This is great news in the U.S. Think the share price is about to hit the accelerator.

http://fleetowner.com/telematics/eroad-integrates-fourkites

[freebee]

Yes sp rising, fewer sellers now, the stars (and stripes !) are aligning for Eroad to hopefully take full advantage of. It's a crucial time for the company right now to turn all of their hard work into sales and good market share. I hope they have enough good manpower and stock to cater for what looks like a real last minute rush for every fleet owner to comply by end of this year. And if all goes well over next few months in US, just up the road the Canadians are looking like following with compulsory ELD's in 2018 so it's all looking promising at this stage... looking forward to a positive update from Eroad soon!

[kiwi_crusader]

With what I'm reading, seeing and hearing, there has to be a great big announcement coming from Eroad very soon. Another software integration, McLeod Software today. SP heading the right way.

[freebee]

And here it is https://www.nzx.com/companies/ERD/announcements/308234

Great news from Eroad and only the beginning of a great run coming up

[smalltrader]

Wow stunning day. Closing at day high + nzx high 👍👍👍

[BlackPeter]

And here it is https://www.nzx.com/companies/ERD/announcements/308234

Great news from Eroad and only the beginning of a great run coming up

Sales numbers and technicals looking certainly much happier than still in June. It looks like their new strategy of leasing instead of selling gets traction and their US market (though they still make only a tiny contribution) shows healthy growth as well.

Given healthier fundamentals and a clear uptrend did I dipped a toe back into the water and bought a small parcel.

Let the momentum grow ... they still owe me some money from the bad old days where people with insider information sold before the market got the news. Ah well, I understand the courts have spoken, so lets assume they learned from this unfortunate episode.

[kiwi_crusader]

I was reading the other day, only 60% of fleets have gone to ELDs so far before December's dead line and a number of the ones who have the app based ones are finding that they are not doing the job. Many are looking to change to Eroad tethered type ELD's, so hopefully the next 6 months sales will show awesome results.

And with Winnie saying exporters will be happy with the dollar, here's hoping for great profits.

[bullfrog]

Really like this company, and have done very nicely out of the recent rise in share price however, I do wonder about the long term future of ERD.

I know that sometimes negative comments go down like a waxed anvil on this forum, but if I’ve thought of it, others who are far smarter than me will be thinking it too…

First of all, there’s the ubiquitous installation of internet in every new car. Correct me if I’m wrong, but doesn’t this allow new cars to be easily located if they are stolen? I’ve also heard that software in a Benz can now choose the right gear for the next bend by referencing your position with your map position. Then there was the thought that Google would develop into a self drive car manufacturer, I don’t think this will happen but it shows how the internet is already an integral part of every new car or truck.

On this internet/car theme, and bringing out my crystal ball, lets throw mixed reality into the errr mix. This is where software scans your immediate environment and overlays information on it. I can just imagine driving down the road, and each window of your car will have a heads up display showing adverts and sale specials overlaying the shops you are passing, a marketers dream. The tech is all there, just need to join the dots.

Finally, if you talk to Gen X(?), they’re not interested in driving, they’re interested in getting there and on the way catching up with the world on their phones/in-car internet device. Look at the stats for driving while on the phone. Self drive cars with wifi is what the next gen want.

So with all this in-car inter-connectivity, and it will be pretty high spec stuff, why would businesses lease a GPS software gizmo when the Google/Microsoft/Apple/Xero(!) car app can give them everything using factory pre-installed hardware coming as standard?

I believe ERD need to be ready to migrate away from their lease-a-box business and get into using the vehicle computer to run their software… take a leaf out of PPH’s business model.

[BlackPeter]

Really like this company, and have done very nicely out of the recent rise in share price however, I do wonder about the long term future of ERD.

I know that sometimes negative comments go down like a waxed anvil on this forum, but if I’ve thought of it, others who are far smarter than me will be thinking it too…

First of all, there’s the ubiquitous installation of internet in every new car. Correct me if I’m wrong, but doesn’t this allow new cars to be easily located if they are stolen? I’ve also heard that software in a Benz can now choose the right gear for the next bend by referencing your position with your map position. Then there was the thought that Google would develop into a self drive car manufacturer, I don’t think this will happen but it shows how the internet is already an integral part of every new car or truck.

On this internet/car theme, and bringing out my crystal ball, lets throw mixed reality into the errr mix. This is where software scans your immediate environment and overlays information on it. I can just imagine driving down the road, and each window of your car will have a heads up display showing adverts and sale specials overlaying the shops you are passing, a marketers dream. The tech is all there, just need to join the dots.

Finally, if you talk to Gen X(?), they’re not interested in driving, they’re interested in getting there and on the way catching up with the world on their phones/in-car internet device. Look at the stats for driving while on the phone. Self drive cars with wifi is what the next gen want.

So with all this in-car inter-connectivity, and it will be pretty high spec stuff, why would businesses lease a GPS software gizmo when the Google/Microsoft/Apple/Xero(!) car app can give them everything using factory pre-installed hardware coming as standard?

I believe ERD need to be ready to migrate away from their lease-a-box business and get into using the vehicle computer to run their software… take a leaf out of PPH’s business model.

Mmh - not sure you fully understand ERD's business and customer base.

Couple of things:

ERD are serving truck companies, not Gen X drivers (or non-drivers). Not that many in window ads and other gadgets in trucks (and I doubt the authorities would allow this in private cars either) ... and yes, it is correct and absolutely desirable that the company can track their vehicle wherever it is.

Self driving trucks? Absolutely - and they wouldn't change ERD's business case a bit. Trucks still would need to pay RUC.

And the other issue - to pay road user charges you can't just load an app on any platform - the authorities need to approve the combination of hardware and software before they accept this unit as a legit and temper-proof way to pay the RUC. Not sure I'd expect this to happen anytime soon on the onboard computer of any vehicle. Sure - it should be possible, but even then it is no advantage for fleet operators. They don't want a different system for each truck depending on make and year - they want a system which allows them to treat all trucks the same.

[thedrunkfish]

Having only done minimal research on the company, it would seem to me they are not targeting new cars or private vehicles.

Seems more to do with fleet management / compliance and H&S. The blog on Eroad's website is an interesting read.


Really like this company, and have done very nicely out of the recent rise in share price however, I do wonder about the long term future of ERD.

I know that sometimes negative comments go down like a waxed anvil on this forum, but if I’ve thought of it, others who are far smarter than me will be thinking it too…

First of all, there’s the ubiquitous installation of internet in every new car. Correct me if I’m wrong, but doesn’t this allow new cars to be easily located if they are stolen? I’ve also heard that software in a Benz can now choose the right gear for the next bend by referencing your position with your map position. Then there was the thought that Google would develop into a self drive car manufacturer, I don’t think this will happen but it shows how the internet is already an integral part of every new car or truck.

On this internet/car theme, and bringing out my crystal ball, lets throw mixed reality into the errr mix. This is where software scans your immediate environment and overlays information on it. I can just imagine driving down the road, and each window of your car will have a heads up display showing adverts and sale specials overlaying the shops you are passing, a marketers dream. The tech is all there, just need to join the dots.

Finally, if you talk to Gen X(?), they’re not interested in driving, they’re interested in getting there and on the way catching up with the world on their phones/in-car internet device. Look at the stats for driving while on the phone. Self drive cars with wifi is what the next gen want.

So with all this in-car inter-connectivity, and it will be pretty high spec stuff, why would businesses lease a GPS software gizmo when the Google/Microsoft/Apple/Xero(!) car app can give them everything using factory pre-installed hardware coming as standard?

I believe ERD need to be ready to migrate away from their lease-a-box business and get into using the vehicle computer to run their software… take a leaf out of PPH’s business model.

[bullfrog]

Mmh - not sure you fully understand ERD's business and customer base.

Couple of things:

ERD are serving truck companies, not Gen X drivers (or non-drivers). Not that many in window ads and other gadgets in trucks (and I doubt the authorities would allow this in private cars either) ... and yes, it is correct and absolutely desirable that the company can track their vehicle wherever it is.

Self driving trucks? Absolutely - and they wouldn't change ERD's business case a bit. Trucks still would need to pay RUC.

And the other issue - to pay road user charges you can't just load an app on any platform - the authorities need to approve the combination of hardware and software before they accept this unit as a legit and temper-proof way to pay the RUC. Not sure I'd expect this to happen anytime soon on the onboard computer of any vehicle. Sure - it should be possible, but even then it is no advantage for fleet operators. They don't want a different system for each truck depending on make and year - they want a system which allows them to treat all trucks the same.

Yep, went a bit "Minority Report" on it, but I think my point about the intrinsic computer power that will be present in all cars and trucks remains valid. I also know that it's not just trucks that are tracked, it's fleet cars, almost all council and govt vehicles are tracked, and probably every ute and sales vehicle that is part of a fleet.

I like your point of one system for all vehicles and the RUC payments. But if the car computer is safe enough to drive you around, it'll be safe enough to pay your RUC... I hope. And I'm thinking that it doesn't matter what device you have, be it a Samsung or Nokia, Ford or Suzuki, the app will still be the same.

Good to test my somewhat random crystal ball readings.

Not sure I'm going to be a fan of MR "Mixed Reality" though...

[BlackPeter]

Yep, went a bit "Minority Report" on it, but I think my point about the intrinsic computer power that will be present in all cars and trucks remains valid. I also know that it's not just trucks that are tracked, it's fleet cars, almost all council and govt vehicles are tracked, and probably every ute and sales vehicle that is part of a fleet.

I like your point of one system for all vehicles and the RUC payments. But if the car computer is safe enough to drive you around, it'll be safe enough to pay your RUC... I hope. And I'm thinking that it doesn't matter what device you have, be it a Samsung or Nokia, Ford or Suzuki, the app will still be the same.

Good to test my somewhat random crystal ball readings.

Not sure I'm going to be a fan of MR "Mixed Reality" though...

Absolutely - there is enough computer power in any cellphone and probably most modern vehicle computers to do what ERD's devices do. However - any mediocre hacker would be able to modify apps running on cellphones - for example to reduce the RUC bill which has to be paid to the land transport authority e.g. by removing individual trips from the record.

The issue is making the system temper-proof. Authorities want to have an easy and reliable method to find out if vehicles use public roads without paying RUC.

Obviously - ERD's devices can do more than that - they allow you to locate and track your vehicles (fleet management), they can replace the manual logbook (e.g. to make sure drivers do take their brakes and don't sit longer behind the wheel than allowed by law). Nothing essential - they just make the life of companies a bit easier and help them to save money for admin and they do develop systems authorities including police (for logbooks) can trust.

Any half capable electronic company could develop such devices. It is just that ERD has so far the market leadership for such systems (as well thanks to the brain dead paper based RUC system they are replacing in NZ) and any other company would first need to develop the Know How ERD already has.

The hope is that more states in the US are introducing a RUC to finance an overhaul of their dilapidating infrastructure and then look for a system which allows easy collection of these fees / taxes.

At this stage I think they might have found a market niche similar to what Diligent did with electronic distribution of board papers or what some people think PPH is doing for collecting the givings of the faithful by app. None of that would have been difficult to replicate by some other company, but sometimes it makes a difference if you are the first in a niche market.

Are they a guaranteed success? Certainly not.

[bullfrog]

Absolutely - there is enough computer power in any cellphone and probably most modern vehicle computers to do what ERD's devices do. However - any mediocre hacker would be able to modify apps running on cellphones - for example to reduce the RUC bill which has to be paid to the land transport authority e.g. by removing individual trips from the record.

The issue is making the system temper-proof. Authorities want to have an easy and reliable method to find out if vehicles use public roads without paying RUC.

Obviously - ERD's devices can do more than that - they allow you to locate and track your vehicles (fleet management), they can replace the manual logbook (e.g. to make sure drivers do take their brakes and don't sit longer behind the wheel than allowed by law). Nothing essential - they just make the life of companies a bit easier and help them to save money for admin and they do develop systems authorities including police (for logbooks) can trust.

Any half capable electronic company could develop such devices. It is just that ERD has so far the market leadership for such systems (as well thanks to the brain dead paper based RUC system they are replacing in NZ) and any other company would first need to develop the Know How ERD already has.

The hope is that more states in the US are introducing a RUC to finance an overhaul of their dilapidating infrastructure and then look for a system which allows easy collection of these fees / taxes.

At this stage I think they might have found a market niche similar to what Diligent did with electronic distribution of board papers or what some people think PPH is doing for collecting the givings of the faithful by app. None of that would have been difficult to replicate by some other company, but sometimes it makes a difference if you are the first in a niche market.

Are they a guaranteed success? Certainly not.

I think we're both in agreement. We're on a rollercoaster with this one.

[kiwi_crusader]

New player hit town 6 weeks ago with a device to collect RUC's in New Zealand. http://www.coretex.com/news/eruc-now-available-on-coretex-360/

[kiwi_crusader]

Eroad getting a little competition in NZ now with yet another company collecting RUC's.

http://dieseltalk.co.nz/news/teletrac-navman-approved-collect-ruc

[kiora]

New player hit town 6 weeks ago with a device to collect RUC's in New Zealand. http://www.coretex.com/news/eruc-now-available-on-coretex-360/

Its been around since 2005?
https://nz.linkedin.com/company/international-telematics

[freebee]

Eroad's USA profile is growing, lots to look forward to here

http://www.truckinginfo.com/channel/fleet-management/news/story/2017/11/eroad-tapped-for-major-mileage-based-user-fee-pilot.aspx

[BlackPeter]

Anybody noticing the lovely SP appreciation today? Up 45 cents, that's 15% ... without any news (unless the market took more than a day to digest the news released on Tuesday about ERD's involvement in this latest US trial).

Discl: Happy holder

[freebee]

I noticed BP, definite uptrend recently and a Huge day today. Your comparison to pph spot on, nz company with a great product into a massive USA market with,perfect timing whats not to like.
Happy holder

[axe]

results due shortly - cash flow will be interesting see from last two quarters :)


Anybody noticing the lovely SP appreciation today? Up 45 cents, that's 15% ... without any news (unless the market took more than a day to digest the news released on Tuesday about ERD's involvement in this latest US trial).

Discl: Happy holder

[freebee]

Half year results due out Tuesday then conference call to discuss outlook for next 6 months maybe to do with jump up today? Will be very interesting to see how they are tracking and most important for me is what are the US market share projections

[freebee]

Half year results released on Tuesday, surprising there is not more discussion about Eroad on here, as of last week, their share price up 110 percent so far this year, the 7th best performing stock on the S&P/NZX All Index , not too shabby!
The half year result pretty much as expected for me, a bit disappointing to see that ugly 3.7m loss down from around breakeven point and probably why SP has dropped back a bit after result released as expectation may have been higher. Large one off US set up costs dragged the NZ profit away and may do a bit more until US costs stabilise and sales increase. Happy with how this is tracking and with good solid investment now in US market, the next 12 months are looking very good IMO.

http://www.sharechat.co.nz/article/7e6d6be6/eroad-first-half-loss-widens-on-us-investment-taps-first-nz-capital-to-review-north-american-business.html

· Revenue at $20.9 million up by 35% over same period last year
· EBITDA of $4.0 million during the period underpinned by EBITDA of the New Zealand/Australia business which reached $11.1 million during the period
· Net Loss before tax $3.7 million, driven by investment in US sales activity
· Total Contracted Units in New Zealand/Australia 49,802 up by 31% since September 2016
· Total Contracted Units in North America 9,736 up by over 84% since September 2016
· Q1 and Q2 of FY18 were both record sales quarters for the New Zealand and North American markets
· Customer Retention Rate remains strong at 98%
· Future Contracted Income grew to $75 million during the period up $17m or 29% in 6 months
· Secured new credit facility from the BNZ totalling $33.4 million for initial term of 12 months with initial drawdown in July 2017. Post September 2017, EROAD has subsequently signed a credit approved facility letter with the BNZ to further extend its facilities by approximately $16 million, to further support expected growth
· Strong momentum has continued in the business with total contracted units increasing in October 2017 by 1,133 units for the New Zealand/Australia business and 1,166 units for the North American business
· As part of EROAD’s continuing focus on growth in the US, EROAD has engaged First NZ Capital to undertake a strategic review of its North American business. The review is focused on evaluating options to further capture the compelling growth opportunity in North America.

The last point was interesting. In an NBR interview with CEO Steven Newman, he was asked if engaging First NZ Capital was an indication that they may be looking to sell off Eroad’s North American business sometime in the future he replied ‘I think that could be one option, but an unlikely option’ and went on to say they are looking to First NZ Capital to analyse their distribution options to maybe engage in a joint venture or distribution partner in addition to their existing sales channels. It sounds to me like they are expecting a huge demand for their product over the next few years and they are trying to work out the best way to capitalise on it.


Any thoughts?

[BlackPeter]

Half year results released on Tuesday, surprising there is not more discussion about Eroad on here, as of last week, their share price up 110 percent so far this year, the 7th best performing stock on the S&P/NZX All Index , not too shabby!
The half year result pretty much as expected for me, a bit disappointing to see that ugly 3.7m loss down from around breakeven point and probably why SP has dropped back a bit after result released as expectation may have been higher. Large one off US set up costs dragged the NZ profit away and may do a bit more until US costs stabilise and sales increase. Happy with how this is tracking and with good solid investment now in US market, the next 12 months are looking very good IMO.

http://www.sharechat.co.nz/article/7e6d6be6/eroad-first-half-loss-widens-on-us-investment-taps-first-nz-capital-to-review-north-american-business.html

· Revenue at $20.9 million up by 35% over same period last year
· EBITDA of $4.0 million during the period underpinned by EBITDA of the New Zealand/Australia business which reached $11.1 million during the period
· Net Loss before tax $3.7 million, driven by investment in US sales activity
· Total Contracted Units in New Zealand/Australia 49,802 up by 31% since September 2016
· Total Contracted Units in North America 9,736 up by over 84% since September 2016
· Q1 and Q2 of FY18 were both record sales quarters for the New Zealand and North American markets
· Customer Retention Rate remains strong at 98%
· Future Contracted Income grew to $75 million during the period up $17m or 29% in 6 months
· Secured new credit facility from the BNZ totalling $33.4 million for initial term of 12 months with initial drawdown in July 2017. Post September 2017, EROAD has subsequently signed a credit approved facility letter with the BNZ to further extend its facilities by approximately $16 million, to further support expected growth
· Strong momentum has continued in the business with total contracted units increasing in October 2017 by 1,133 units for the New Zealand/Australia business and 1,166 units for the North American business
· As part of EROAD’s continuing focus on growth in the US, EROAD has engaged First NZ Capital to undertake a strategic review of its North American business. The review is focused on evaluating options to further capture the compelling growth opportunity in North America.

The last point was interesting. In an NBR interview with CEO Steven Newman, he was asked if engaging First NZ Capital was an indication that they may be looking to sell off Eroad’s North American business sometime in the future he replied ‘I think that could be one option, but an unlikely option’ and went on to say they are looking to First NZ Capital to analyse their distribution options to maybe engage in a joint venture or distribution partner in addition to their existing sales channels. It sounds to me like they are expecting a huge demand for their product over the next few years and they are trying to work out the best way to capitalise on it.


Any thoughts?

Experts certainly expect huge market growth (makes sense - electronic road fees are a sensible method to pay for deteriorating infrastructure), and ERD are currently (while not the largest) one of the bigger fishes in the so far rather untouched US market.

There is certainly huge potential - whether they will live up to it is yet unknown.

On the other hand - the technology is not that hard to implement (no rocket science) and the US market is not always nice to foreign players.
Overall I can probably remember more recent NZ companies who underperformed in the US market (e.g. PEB, OHE) than companies who succeeded (e.g. DIL).
Many more companies who want to get rich in the US than companies who do.

Time will tell, whether ERD are the next DIL or the next OHE.

Discl: hold (a small parcel) and like the (recent) trend so far ...

[thedrunkfish]

Half year results released on Tuesday, surprising there is not more discussion about Eroad on here, as of last week, their share price up 110 percent so far this year, the 7th best performing stock on the S&P/NZX All Index , not too shabby!
The half year result pretty much as expected for me, a bit disappointing to see that ugly 3.7m loss down from around breakeven point and probably why SP has dropped back a bit after result released as expectation may have been higher. Large one off US set up costs dragged the NZ profit away and may do a bit more until US costs stabilise and sales increase. Happy with how this is tracking and with good solid investment now in US market, the next 12 months are looking very good IMO.

http://www.sharechat.co.nz/article/7e6d6be6/eroad-first-half-loss-widens-on-us-investment-taps-first-nz-capital-to-review-north-american-business.html

· Revenue at $20.9 million up by 35% over same period last year
· EBITDA of $4.0 million during the period underpinned by EBITDA of the New Zealand/Australia business which reached $11.1 million during the period
· Net Loss before tax $3.7 million, driven by investment in US sales activity
· Total Contracted Units in New Zealand/Australia 49,802 up by 31% since September 2016
· Total Contracted Units in North America 9,736 up by over 84% since September 2016
· Q1 and Q2 of FY18 were both record sales quarters for the New Zealand and North American markets
· Customer Retention Rate remains strong at 98%
· Future Contracted Income grew to $75 million during the period up $17m or 29% in 6 months
· Secured new credit facility from the BNZ totalling $33.4 million for initial term of 12 months with initial drawdown in July 2017. Post September 2017, EROAD has subsequently signed a credit approved facility letter with the BNZ to further extend its facilities by approximately $16 million, to further support expected growth
· Strong momentum has continued in the business with total contracted units increasing in October 2017 by 1,133 units for the New Zealand/Australia business and 1,166 units for the North American business
· As part of EROAD’s continuing focus on growth in the US, EROAD has engaged First NZ Capital to undertake a strategic review of its North American business. The review is focused on evaluating options to further capture the compelling growth opportunity in North America.

The last point was interesting. In an NBR interview with CEO Steven Newman, he was asked if engaging First NZ Capital was an indication that they may be looking to sell off Eroad’s North American business sometime in the future he replied ‘I think that could be one option, but an unlikely option’ and went on to say they are looking to First NZ Capital to analyse their distribution options to maybe engage in a joint venture or distribution partner in addition to their existing sales channels. It sounds to me like they are expecting a huge demand for their product over the next few years and they are trying to work out the best way to capitalise on it.


Any thoughts?

Yeh overall I was happy with the figures. Good growth in the US market and good retention rates. Time will tell. Not particularly fussed about the loss, I guess I see this as a longer term play, as BP alluded to time will tell.

http://eldratings.com/eroad/ - makes interesting reading.

[gbogo]

trading halt today - share placement announced.

https://www.nzx.com/announcements/311778

[BlackPeter]

trading halt today - share placement announced.

https://www.nzx.com/announcements/311778

Hmm - yes, have seen this. While this can be good news, I'd prefer if they give at least some range at what discount they plan to place the shares. The process so far feels a bit haphazard - don't they know what their shares are worth?.

Anyway - not a lot we can do now, it's just wait, hope and see. Don't like the hope component.

Discl: Hold a small parcel and glad now I didn't buy more ...

[gbogo]

I would not worry. Apparently instos took all they were offered. I would think trading halt ends tomorrow morning.

[winner69]

Suppose it’s good that the CEO (or his interests) take $5m off the table

Good Xmas presents and a new deck being built over the holidays.

[freebee]

A fantastic year for Eroad shareholders with the share price rising 120% since Jan. gotta be happy with that!

Share price has bounced back higher after the share placement earlier this month so looks like the market feels this was a good move and there is much more to come if everything continues to track well in USA.
Also looking like there may be some growth in Australia coming up with electronic road tax now being discussed and Eroad putting their hand up to carry out trials like they have in US:
http://www.eroad.com/assets/Uploads/New-Zealand/Media/2017/EROAD-Welcomes-Minister-Fletchers-Announcement-of-Heavy-Vehicle-Charging-Initiatives.pdf

Locally i'm sure Eroad will be involved in this if it eventuates:
https://www.radionz.co.nz/news/national/347043/call-for-road-charge-tech-to-improve-safety

Well done Eroad - a very happy holder here !

[smalltrader]

High volume today. Turnover is almost as high as ATM. Last year they update the market on 5 Jan. December results should be soon!

[percy]

ERD appear to be gaining momentum in both sales and share price.
I brought a very small parcel at $3.4367 on 22/12/2017 for the wife,after selling her TIL..

[cdonald]

ERD appear to be gaining momentum in both sales and share price.
I brought a very small parcel at $3.4367 on 22/12/2017 for the wife,after selling her TIL..

The charts look great but I really struggle with this company. Seems to be very little information out there about them and the fact that there was an insider trading scandal not so long ago and also one of their founders leaving immediatly without explanation leaves me with massive integrity issues with these guys. I would put it in the same basket as Rakon (apart from people seem to be making money off this despite major shareholders selling down holdings).

The main posts on this thread also tend to be from a couple of people who only post about Eroad. I wonder what their links to insiders are.

[cdonald]

also question the details on their latest announcement. It tells how many units they are selling but not what they are selling them for, or am I missing something... The whole report just talks about units rather than how much those units are selling for. Very strange reporting for a listed company. They could be discounting the heck out of the contracts and pumping out more units.

[percy]

The charts look great but I really struggle with this company. Seems to be very little information out there about them and the fact that there was an insider trading scandal not so long ago and also one of their founders leaving immediatly without explanation leaves me with massive integrity issues with these guys. I would put it in the same basket as Rakon (apart from people seem to be making money off this despite major shareholders selling down holdings).

The main posts on this thread also tend to be from a couple of people who only post about Eroad. I wonder what their links to insiders are.

Yes a company to take care with.
Results in Australia and NZ have financed US development.
I have had them on a watch list for some time waiting for a catalyst announcement.
I am still not a "high conviction " holder,just putting the wife's big toe in the water.
Like the idea,just not sure a Kiwi company can compete with US companies in their home territory.
I also hold a few IKE.

[winner69]

PIE Funds still raving about Eroad

In this update
https://www.piefunds.co.nz/assets/newsletters/PieFunds-Newsletter-January-2018/Monthly-Newsletter-January-18.pdf?utm_medium=email&utm_campaign=Slice%20of%20Pie%20-%20January%202018&utm_content=Slice%20of%20Pie%20-%20January%202018+CID_68965af5d35e2d564d24b0221d54 a10e&utm_source=Email%20marketing%20software&utm_term=PDF%20Newsletter

[Beagle]

Very interesting comparing the performance of their funds relative to the index's, something they very conveniently overlook doing in their slice of pie e newsletter.
On topic I bought a few last week as a speculative small position.

[axe]

Keeping a few pennies ready for the SPP?


Very interesting comparing the performance of their funds relative to the index's, something they very conveniently overlook doing in their slice of pie e newsletter.
On topic I bought a few last week as a speculative small position.

[stoploss]

Very interesting comparing the performance of their funds relative to the index's, something they very conveniently overlook doing in their slice of pie e newsletter.
On topic I bought a few last week as a speculative small position.

Roger if you take another look at the link in the update you will see there are two bars side by side one is Pie Fund Performance the other Grey the relative index , looks pretty obvious to me , did YOU overlook something ?

[Beagle]

Keeping a few pennies ready for the SPP?
Yes.


Roger if you take another look at the link in the update you will see there are two bars side by side one is Pie Fund Performance the other Grey the relative index , looks pretty obvious to me , did YOU overlook something ?
and Yes quite probably..its the holidays so I just briefly skim read their bumph.

[Yoda]

SP moving up...... I asked my banker friend to look into this for me, and after a few phone calls came back very exited ...next xero.. Bla bla.... Etc

[freebee]

SP moving up...... I asked my banker friend to look into this for me, and after a few phone calls came back very exited ...next xero.. Bla bla.... Etc

The next Xero ? hope so! but for now well oversubscribed for the SPP. Looking forward to next update

https://www.nzx.com/announcements/314866

[freebee]

Keeping a few pennies ready for the SPP?

SPP issue price ended at $3.04. maximum allocation was $15k but was scaled back as was oversubscribed. Put in for maximum, with scaling back received around 3000 shares at 3.04 end of last week, todays SP 3.65. Very good return for shareholders. Anyone else here participate in the SPP ?

[BlackPeter]

SPP issue price ended at $3.04. maximum allocation was $15k but was scaled back as was oversubscribed. Put in for maximum, with scaling back received around 3000 shares at 3.04 end of last week, todays SP 3.65. Very good return for shareholders. Anyone else here participate in the SPP ?

Sure - why do yo think anybody would not have participated? Free money, even if I only got one third of what I asked for (probably smaller holding than you have).

[Balance]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12014311

Insider trading case starts.

Shares now trading $3.90 so he should have just kept the shares and avoid all this aggravation.

[Yoda]

EROAD responds to lifting of name suppression


ERD
19/03/2018 15:40
GENERAL
NOT PRICE SENSITIVE
REL: 1540 HRS EROAD Limited


GENERAL: ERD: EROAD responds to lifting of name suppression


EROAD responds to lifting of name suppression


Transport technology services company EROAD says it supports the lifting of
name suppression obtained by the FMA against Hamish Sansom.


Chief executive Steven Newman says we are disappointed in the alleged
behaviour of Mr Sansom. Mr Sansom was an employee of EROAD between 30
September 2013 to 3 April 2015. Mr Sansom was not employed by EROAD at the
time that the alleged offending occurred in September 2015.


"EROAD fully supports the FMA's action and EROAD has fully co-operated with
the investigation into the insider trading allegations. EROAD's conduct was
not part of the FMA's investigation" he said.


As the matter is still before the Courts EROAD will be making no further
comments at this time.


For further information:


Mark Heine
Executive Vice President, General Counsel & Company Secretary
DDI +64 9 927 4710 (tel:+64 9 927 4710)
M +64 27 973 2106 (tel:+64 27 973 2106)
E mark.heine@eroad.com


ENDS
End CA:00315697 (tel:00315697) For:ERD Type:GENERAL Time:2018-03-19 15:40:09

--------------------------------------------
Interesting that he wasn't an employee at the time, and had left the company 5 months previously.
all this might drag the SP down a little maybe ?

Yep your right Balance, investing verses trading eh?
I would have $2 million now if i had left my original A2 shares where they were at .50c ..... When i made 100%+ i thought i had done well !

[BlackPeter]

Nice sales update:


• Annual Unit Growth of 29,559, an increase of 61.5% to the prior year. This is consistent with the forecast annual targets communicated in the December 2017 Investor presentation.
• ANZ grew by 17,904 units this year, a 42.7% annual growth rate, and finished with a fourth consecutive quarter of record growth.
• North America grew by 11,655 units or 191.0% for the year, the final quarter was the second strongest quarter for the North American market.

https://www.nzx.com/announcements/316437

Starts to feel like their North American game seems to play out well. Up 191% for the year is not too bad - and compared to previous years are now the absolute numbers material as well :);

Discl: In (medium-sized holding); Topped up a bit after this news;

[jimmybuffett]

https://www.nzx.com/announcements/316437

Eroad mkt update - on track to meet guidance, unit sales up 61.5% YOY, but impressively 191% in USA. Still smaller in States than Aus/NZ but for how long.

[jimmybuffett]

Nice sales update:



https://www.nzx.com/announcements/316437


Snap, sorry, we posted at the same time.

[cdonald]

https://www.nzx.com/announcements/316437

Eroad mkt update - on track to meet guidance, unit sales up 61.5% YOY, but impressively 191% in USA. Still smaller in States than Aus/NZ but for how long.

It would be nice to see what $$$ effect these sales have. Its hard to know if they are increasing volume by offering discounts or if there is real high value coming in. Always suspicious when no dollar value is given for the sales.

[BlackPeter]

It would be nice to see what $$$ effect these sales have. Its hard to know if they are increasing volume by offering discounts or if there is real high value coming in. Always suspicious when no dollar value is given for the sales.

They don't sell their units, but lease them out. High customer loyalty (from memory well above 95%).

So - this is not one off revenue but a rapidly increasing income stream :);

Unlikely that they discount leases, but if you want to know how much one unit is worth to them, than just take the last annual report (or their recent investor presentation) and divide their revenue by number of units at that time.

from http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/311787/271598.pdf


For the full FY18 year EROAD expects:
• Total contracted units in excess of 77,000
• Total group revenue between $46.9 million and $47.6 million
• Group EBITDA between $12.8 million and $13.3 million

Now - not all units are equal, customers can lease various additional modules. However - based on above data is one new leased unit in average worth roughly $614 in annual revenue. Obviously the EBITDA component is less likely to be linear.

[Yoda]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/316478/277373.pdf

good to see HAM buying too.

[BlackPeter]

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/316478/277373.pdf

good to see HAM buying too.

Well, yes - though wasn't it the same crowd buying quite late into the game into CBL?

Don't misunderstand me, I am positive on ERD. Just not sure whether Harbour buying is a positive indicator. I think it is more likely uncorrelated to the quality of whatever they buy or sell ...

[Yoda]

Yes I see your point thank you

[BlackPeter]

Sweet:

• Total Contracted Units up 61.5% to 77,600 (FY17: 48,041)
• Revenue up 57% to $51.5 million (FY17: $32.7 million)
• EBITDA up 113% to $15.0 million (FY17: $7.1 million)
• Net Profit after Tax of $0.2m vs a net loss after tax of $5.3 million in FY17, a positive change of $5.5 million
• In the second half of the year the business graduated from start-up mode, generating self-sustaining cash flows for the first time

Well done, particularly considering that the market still expected a small loss (vs a very small profit) and less growth than they achieved (latest analyst consensus was 47.5m vs the achieved 51.5m).

https://www.nzx.com/announcements/318137

This should give the SP some deserved wings ...

[BlackPeter]

Ah yes - and US sales now exceeding the sales in their home market (AU/NZ) ... looks like they made a credible dent ;)

The sky is the limit?

[Leftfield]

I've been watching this one for awhile and I see a lot to like about today's release. Snuck in early today and ERD now part of my portfolio with a small blue arrow beside it already.

[RupertBear]

I've been watching this one for awhile and I see a lot to like about today's release. Snuck in early today and ERD now part of my portfolio with a small blue arrow beside it already.

Same here Left field :)

[freebee]

Great result with record sales and revenue - a lot of good reading in the announcement.

https://www.nzx.com/announcements/318182

Apart from the figures, some highlights for me:
A very good 98% customer retention rate (happy customers are the best advertising)
USA sales are already more than NZ and Australia combined, and growing
Having the foresight to get their ELD independently verified in the US to give customers trust in the product has really paid off

Adding value by getting into the telematics side with driver fatigue/safety aspect of transport along with the base road tax aspect.

Australian market looking set to grow with Australian federal govt announcing pilot program for collecting road tax electronically.



Also looking forward, from the announcement:


Outlook for FY19
The growth in units this year has put the company on a stronger financial footing, and the experiences gained from a rapid scale-up in sales and customer support means EROAD is in a good position for the year ahead, said Mr Newman.
This came at a time when the global trend towards electronic road user charging as an alternative to fuel taxes was accelerating due to the commercialisation of electric trucks and vans, which will rapidly and severely impact fuel tax-based road funding, he said.

In addition, a parallel trend of addressing driver fatigue and improving road safety was promoting the growth of regulatory telematics, said Mr Newman. The mandated use of electronic logging devices in North America was part of a global move to better manage fatigue in the transport industry.

“EROAD is well positioned to meet both these opportunities,” he said.


I like the last line….:)

[Yoda]

SP moving up...... I asked my banker friend to look into this for me, and after a few phone calls came back very exited ...next xero.. Bla bla.... Etc
Happy boy today :p

[Leftfield]

Happy boy today :p

Roughly 90% SP appreciation since this time last year, and as Freebee points out 98% customer retention, initial profit can only grow, exciting potential in USA and Australia markets, so I'm happy to join this club and yes, we are "well positioned." Exciting times ahead IMO.

[percy]

Seems a bit odd to me that eldratings.com rated them third with 8.5, compared with 9 for the first two,yet user ratings achieved by Keep Tuckin were only two and three quarters, and Omnitraces OVG a low two and a half,miles behind Eroad's five.

[bullfrog]

Good sleuthing Percy, noted that eroad is the only device that has been independently certified for future compliance. Also liked the way they actually responded to critical reviews unlike other companies, shows that they’re watching and protecting their reputation/image.

[sb9]

Thanks for that someone who obliged to fill my remainder of the order from Friday.

[sb9]

Hmmm...gone bit quiet around here. The euphoria following results announcement seem to have fizzed off, at least for now.

[bullfrog]

Shhhh let the price fall and accumulate

[Leftfield]

I guess this news means ERD will not be issuing more shares via a Capital Raising, and can step up the pace of its growth?

"13 June 2018 Auckland - Electronic road user charges and compliance services provider EROAD has won the EY debt deal of the year at the INFINZ 2018 Industry Awards.

The judges said of EROAD’s $48 million multi-option credit facility: “This highly innovative funding mechanism enabled EROAD, who were growing rapidly, to leverage its largest asset (and a non-balance sheet item), being future contracted income, and intangible assets.”

The annual INFINZ Industry Awards are the New Zealand finance industry’s premier awards.

EROAD chief executive officer Steven Newman said the company was delighted by the industry’s acknowledgement, and EROAD was already enjoying the benefits of the award-winning deal which was a key platform for continued growth.

Mr Newman said that credit for the deal was shared with its finance partner BNZ, which shared a desire to innovate, recognising the value in being able to leverage assets like future contracted income to support a fast-growing company."

[Leftfield]

More good growth signalled. USA still very much a work in progress.

Quarter to 30 June 2018
Total Contracted Units*
Total at Mar-18
77,600
Total at Jun-18
81,772
Units added in Quarter
4,172
% growth in Quarter
5%
% growth Annualised
22%

[sb9]

More good growth signalled. USA still very much a work in progress.

Quarter to 30 June 2018
Total Contracted Units*
Total at Mar-18
77,600
Total at Jun-18
81,772
Units added in Quarter
4,172
% growth in Quarter
5%
% growth Annualised
22%

Yes good numbers overall, however not sure how the market will react to below commentary...

"The unit sales in the first quarter of FY19 has been much slower than we initially expected as many deals have been pushed out beyond the quarter. While the annual unit sales cycle has always been seasonal, the expected delivery timeframe for units in the sales pipeline this year results in an expectation that quarterly unit sales will be much more lumpy in FY19 than prior years."

[hardt]

Not as good as I was hoping, fairly disappointed... understand FY results matters most and expecting great things.

Disc: hold

[whatsup]

Will they get back o the SPP price, I don't think so , this is a blip but one that could put the scares into weak holders.

[BlackPeter]

Looks like the news was not as outrageously good as the market expected ... but if we believe management than this would be a good opportunity to load up some more ;);

[hardt]

Next quarter has to be huge to confirm lumpiness.
I believe next quarter will be a great one so topping up around 315, hoping I get some more.

[percy]

Next quarter has to be huge to confirm lumpiness.
I believe next quarter will be a great one so topping up around 315, hoping I get some more.

With the share price breaking both the 90 day and 200 day moving averages, you may get all you want at $3.15.?

[sb9]

Next quarter has to be huge to confirm lumpiness.
I believe next quarter will be a great one so topping up around 315, hoping I get some more.

Yes, i'm keeping some powder dry if that opportunity eventuates.

[jg8512]

a wee snippet from the UK listed Quartix (in its interims results) getting out of the larger US interstate telematics market - indicative of a tough market

"The Group continued to develop its operations successfully in the USA, taking its subscription base to 10,840 vehicles. This is 42% higher than it was 12 months ago (30 June 2017: 7,613). Revenue increased by 35% to $0.9m (2017: $0.7m). Following a review of the growth opportunities in the USA, the Board has decided not to further pursue any R&D on its ELD logging application. Whilst a potentially attractive market, this logging system is targeted at larger interstate trucking operations and is subject to a complex set of technical requirements and vehicle interfaces needed to support it. Our conclusion has been that focusing on developing our core market offering to smaller fleet vehicles offers a much clearer path to sustained growth. All costs incurred in the ELD programme were written off as they were incurred. The project team working on this development has been refocused on product developments which are relevant to our core fleet business in all markets."

by way of background, QUartix describes itself as a "leading supplier of subscription-based vehicle tracking systems, software and services. The Group provides an integrated tracking and telematics data analysis solution for fleets of commercial vehicles and motor insurance providers which improves productivity and safety and which lowers costs by capturing, analysing and reporting vehicle and driver data."

[BlackPeter]

a wee snippet from the UK listed Quartix (in its interims results) getting out of the larger US interstate telematics market - indicative of a tough market

"The Group continued to develop its operations successfully in the USA, taking its subscription base to 10,840 vehicles. This is 42% higher than it was 12 months ago (30 June 2017: 7,613). Revenue increased by 35% to $0.9m (2017: $0.7m). Following a review of the growth opportunities in the USA, the Board has decided not to further pursue any R&D on its ELD logging application. Whilst a potentially attractive market, this logging system is targeted at larger interstate trucking operations and is subject to a complex set of technical requirements and vehicle interfaces needed to support it. Our conclusion has been that focusing on developing our core market offering to smaller fleet vehicles offers a much clearer path to sustained growth. All costs incurred in the ELD programme were written off as they were incurred. The project team working on this development has been refocused on product developments which are relevant to our core fleet business in all markets."

by way of background, QUartix describes itself as a "leading supplier of subscription-based vehicle tracking systems, software and services. The Group provides an integrated tracking and telematics data analysis solution for fleets of commercial vehicles and motor insurance providers which improves productivity and safety and which lowers costs by capturing, analysing and reporting vehicle and driver data."

Cheers for posting. Interesting and certainly relevant to consider.

This company (Quartix) seems to offer all the ad-on's ERoad has in its product portfolio (like electronic logbook, vehicle location, monitoring driver behavior), but they don't seem to offer Eroads core functionality (electronic road user charges). Looks like they come from the fleet management domain. This is a huge area with ferocious competition, more established and less regulated than electronic road user charges.

Obviously - fleet management and road user charging might well grow into each other in the future - in this context it might be a good sign to see one potential competitor throwing the towel ...

[freebee]

Driver tiredness monitoring is another part to modern vehicle technology and is very important, especially passenger transport. I remember many years ago being a passenger in a long bus trip through Europe (the magic bus from London to Athens if anyone remembers that) looked up during the night and saw the driver nodding off to sleep in his rear view mirror. Very close to a disaster for all on board and only lucky i spotted it. This technology has to help keep people safe.

http://transporttalk.co.nz/news/transport-industry-adopts-face-tracking-save-lives

[Yoda]

Does anyone have any info from the meeting ? I think it was at 4.45 today.........

[BlackPeter]

Does anyone have any info from the meeting ? I think it was at 4.45 today.........

Haven't been there (sorry, wrong island ;)) - but the presentation is worthwhile to read.

Pretty impressive visualization of their growth ... and I like the feedback from the US:

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/321642/283782.pdf

[percy]

Haven't been there (sorry, wrong island ;)) - but the presentation is worthwhile to read.

Pretty impressive visualization of their growth ... and I like the feedback from the US:

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/321642/283782.pdf

Very positive presentation.

[RupertBear]

Sold out of PPH the other day just before it dropped for a 40% profit and topped up my small ERD holding, so far so good :D

[Yoda]

This is just awesome ,so easy to understand and a picture speaks a thousand words .....

[Yoda]

This is just awesome ,so easy to understand and a picture speaks a thousand words .....
It’s been a bit quiet, and SP a bit horizontally” or down of late . Not sure I I should move sme to SKO OR OCA or just stick with the diversification .... any thoughts ?

[RupertBear]

It’s been a bit quiet, and SP a bit horizontally” or down of late . Not sure I I should move sme to SKO OR OCA or just stick with the diversification .... any thoughts ?

I have been thinking exactly the same thing Yoda! Very tempted to get a few more SKO to be honest but I know as soon as I sell some ERD they will go up! I think if SKO drops back a bit I will move some ERD to SKO as SKO seems a better bet to me atm :)

[Yoda]

Like you i am not too keen on betting... i like to call it calculated risk... at least thats how i explain it to my wife !

[BlackPeter]

Still nicely above the EMA200 - i.e. not really a reason to sell - and for my understanding do the charts not show insiders selling, just a long time since the last good news event (and markets can be impatient, can't they)? BTW - falling wedges are more often than not a bullish TA signal ...

Analyst forecasts quite positive: forward PE: 21, forward revenue CAGR: 47, forward (earnings) CAGR: 28; PEG: 0.75! Remember as well these amazing slides in the last AGM illuminating the growth of coverage in the US?

Their systems are ranked according to independant consumer reports in the top three in the US market and the market size is only limited by ones imagination ...

On the other hand - things often take longer than one hopes - I don't think anybody can exclude the risk of some delays (do I need to mention politics?) and a SP dip ... its just - so far the charts don't show this.

I do see ERD as a promising candidate for Jim Slaters system and do hold a medium-sized parcel. If analyst forecasts are right, than I would see them in 2020 (after 3 years of healthy earnings growth) as a screeming buy ... but I'd think as well that they would be at that stage more expensvie than they are now.

They well might be the next GTK (or - bumpier - XRO). But obviously ... there are risks.

Patience is the mother of investment success :);

[Yoda]

Thanks BP.. your wisdom is apreciated.

[RupertBear]

Still nicely above the EMA200 - i.e. not really a reason to sell - and for my understanding do the charts not show insiders selling, just a long time since the last good news event (and markets can be impatient, can't they)? BTW - falling wedges are more often than not a bullish TA signal ...

Analyst forecasts quite positive: forward PE: 21, forward revenue CAGR: 47, forward (earnings) CAGR: 28; PEG: 0.75! Remember as well these amazing slides in the last AGM illuminating the growth of coverage in the US?

Their systems are ranked according to independant consumer reports in the top three in the US market and the market size is only limited by ones imagination ...

On the other hand - things often take longer than one hopes - I don't think anybody can exclude the risk of some delays (do I need to mention politics?) and a SP dip ... its just - so far the charts don't show this.

I do see ERD as a promising candidate for Jim Slaters system and do hold a medium-sized parcel. If analyst forecasts are right, than I would see them in 2020 (after 3 years of healthy earnings growth) as a screeming buy ... but I'd think as well that they would be at that stage more expensvie than they are now.

They well might be the next GTK (or - bumpier - XRO). But obviously ... there are risks.

Patience is the mother of investment success :);

Thanks BP great post very helpful :)

[kiwico]

Thanks BP.. your wisdom is apreciated.

Shouldn't that be something more like "appreciated your wisdom is" :)

[RupertBear]

Hmm dissapointing results, still holding but tempted to move on ;)

[whatsup]

Hmm dissapointing results, still holding but tempted to move on ;)

R B , 22% increase in sales not too shabby IMO .

[RupertBear]

R B , 22% increase in sales not too shabby IMO .

Yes you are right, guess I was expecting more, need to work on my patience a bit more ;)

[whatsup]

I would have thought that ERD sales ann should have been better received by the market, its soft again today will the S P be sub $3.00 before it rises ?

[RupertBear]

Hmmm and down she goes, sold a few at @ $3.34, wish I had sold them all :(

[bullfrog]

Huge volume today, but only small fall in price. Would anyone care to speculate as to why?

[Leftfield]

Huge volume today, but only small fall in price. Would anyone care to speculate as to why?

From a T/A perspective the death cross has been breached and there are no clear signals of a turn-around.....yet.

(This ex holder is happy on the sidelines. GLH.)

[BlackPeter]

Looks like a clever Australian fund picked up all these cheapies:

https://www.nzx.com/announcements/326015

ERD shares still at sales prices available (currently $2.80), but running out fast ...

[Yoda]

Sold at 330. Bought back 275 today. It goes Against the grain to buy in a downtrend. Hopefully not premature

[BlackPeter]

Sold at 330. Bought back 275 today. It goes Against the grain to buy in a downtrend. Hopefully not premature

Impossible to pick bottoms - and sure - this is despite everything still a speculative share. However - not highly speculative, they do make money, they do grow and (at least last year) the 4th quarter was quite nice to them.

I wouldn't be too worried ... and yes, I am holding as well.

[whatsup]

Half yrly results , increased T O and results but still a loss albeit smaller, U S inroads not too bad, Aust so so , N Z great, a little way to go yet.

[BlackPeter]

Half yrly results , increased T O and results but still a loss albeit smaller, U S inroads not too bad, Aust so so , N Z great, a little way to go yet.

Well, yes, though overall growth curve does show some flattening - and I guess they try to get this up again with their re-launch in Australia.

Restated numbers (due to applying the new accounting standards) are lower all across the book, due to leased revenue now only recognised when received (which sort of makes sense) instead of recognising full unit revenue immediately and putting the outstanding payments into receivables - but I suppose this is just "wooden dollars" lost. Still need to get my head around whether these new standards are really a better reflection of the companies position.

Lets hope that the US patent trolls don't consume too much management and legal resources.

[whatsup]

Not good today , down 6.3 % steep fall from its top of $4 in Jan, is there any bottom in sight ??

[BlackPeter]

Not good today , down 6.3 % steep fall from its top of $4 in Jan, is there any bottom in sight ??

Good question. I guess it was not a particularly good day to surprise the market with lower (restated) revenues due to the new accounting standards as well as with another loss where the markets expected this year a material profit (no matter whether this is due to probably sensible investments). This takes the company in the view of themarket back to a "loss making growth-share", where everybody thought they reached last year break even.

While the growth numbers look not too bad - I can't really say that I found the "provided colour" in the investor briefing this morning very inspirational either.

Not sure what "cash flow postitive in the US in the second half" really means for the full year result, but I guess at best I expect at this stage now again a positive zero (earnings wise) again this year.

Will continue to hold (a medium sized parcel) and think that they will do well mid term (couple of years) - but not my highest conviction stock ...

[Yoda]

Sold at 330. Bought back 275 today. It goes Against the grain to buy in a downtrend. Hopefully not premature
and yes that was a bad choice. I should have watched the MACD and trends more carefully, but I was hoping for a good result but should have had an idea when I sold when Steve Newman did in September . Buying back was a bad idea ..as they say, it can always go lower , and trend is your friend ….

[RupertBear]

and yes that was a bad choice. I should have watched the MACD and trends more carefully, but I was hoping for a good result but should have had an idea when I sold when Steve Newman did in September . Buying back was a bad idea ..as they say, it can always go lower , and trend is your friend ….

You are not alone buying back Yoda :(

[Yoda]

[/B]
You are not alone buying back Yoda :(
Ah well, here's hoping for both of us that things improve . It could have been worse. Its always a hard decision, do you ride it out , or do you cut loose and try to make faster gains somewhere else?
there is something to be said re the tortoise and the hare ...look at MFT for example, a nice steady plodder that i sold at $16 . Lesson learned .

[reon1]

Anyone know if we can expect a market update this month?

[BlackPeter]

Anyone know if we can expect a market update this month?

Good question. They had early January market updates the years before, but than - this was when the news was good and (at least last year) they needed to prime the market to give them more money.

Not a lot of good news since they published the latest accounts - isn't it?

Might be worthwhile to ask their investor relations management. I would do that if I still would hold.

[haewai]

More big share transfers. More downward pressure. Still no quarterly update. :(

[whatsup]

IMO GOOD news comes out early , BAD news come out late or just before the required deadline, !!! not a good look atm !

[winner69]

Still heading in right direction with ‘solid growth’ reported

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/329712/293941.pdf

[BlackPeter]

Still heading in right direction with ‘solid growth’ reported

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/329712/293941.pdf

Sure - however growth in North America (their big future growth market) seems to slow down already. Lets hope this is just a temporary problem, otherwsie this would be a worry.

[whatsup]

Sure - however growth in North America (their big future growth market) seems to slow down already. Lets hope this is just a temporary problem, otherwsie this would be a worry.

Q , How secure is their moat ?

[BlackPeter]

Q , How secure is their moat ?

Hard to say. They used to be one of the first with this technology, but they are not anymore alone in the market - and I learned quite recently that Navman is offering now quite similar products.

https://drive.teletracnavman.co.nz/lp/ppc/ruc/a/

This might be better news for consumers than for ERD shareholders, but I haven't yet seen a consumer focussed comparison of the products - i.e. don't know how big the threat is.

[whatsup]

$2.00 beckoning fallen 50% from its high, even though its numbers are good is there something wrong here ?

[BlackPeter]

$2.00 beckoning fallen 50% from its high, even though its numbers are good is there something wrong here ?

Well, I guess they are basically a growth story with very limited (proven) growth. Markets don't like that so much these days. From my spreadsheet (last updated 20 Feb): forward PE (based on potentially optimistic analyst forecast): 98.3! backward PE is negative (i.e. more losses than profits). And all this coming with a forward (earnings) CAGR of less than 15. Sure - revenue CAGR looks better - but what is revenue growth without earnings?

I guess there are these days just so many better propositions around.

Pity - I did hold them twice and lost both times money. They are now in my "avoid, but keep learning from them" drawer.

[whatsup]

Updated trading and state of the nation along with the biggest order for units from a huge private transport operator for next year give market comfort today which has resulted in steady buying today.

[whatsup]

Updated trading and state of the nation along with the biggest order for units from a huge private transport operator for next year give market comfort today which has resulted in steady buying today.

I have never seen anything like the trading today, someone keeps loading the sales up and keeping the sales at $2.20 all day, so far all of the sales bar the first 3 or 4 have been at $2.20 since the update announcement was made.

How can this happen in an orderly market?

[whatsup]

I have never seen anything like the trading today, someone keeps loading the sales up and keeping the sales at $2.20 all day, so far all of the sales bar the first 3 or 4 have been at $2.20 since the update announcement was made.

How can this happen in an orderly market?


On the road again and off that $2.20 rut now selling @ $2.30ish +, could be a reevaluation by some fish heads going on atm , if so we could be in for a retrace back to $3.00 + .

[bullfrog]

Got the heebeegeebees with this one sometime ago and sold too quickly, missing out on some good rises. Brought in again and this time holding, sought of enjoying the roller coaster ride, I think the big companies take their time in the procurement process, but once they’ve chosen, they’re not going to jump ship. Eroad does what it says on the tin.

[whatsup]

For background ERD was "floated " but not a float in real terms @ $3.00 in Aug 2015 and had a SPP @ $3.00 last year so the todays purchasers would be very pleased with their buying and imho ERD could " make it " if todays ann is an indication of the future potential, ERD needs to " build " on todays results as last years results were marginally profitable !

[sb9]

For background ERD was "floated " but not a float in real terms @ $3.00 in Aug 2015 and had a SPP @ $3.00 last year so the todays purchasers would be very pleased with their buying and imho ERD could " make it " if todays ann is an indication of the future potential, ERD needs to " build " on todays results as last years results were marginally profitable !

Yeah, should see this push past the cap raise/SPP price from last year of $3.04 in short term.

[sb9]

https://www.nzx.com/announcements/331738

Follow the insiders...in this case follow the CEO.

[sb9]

https://www.nzx.com/announcements/331738

Follow the insiders...in this case follow the CEO.

Another Director/Insider buying on market...

https://www.nzx.com/announcements/332437

[whatsup]

Very pleasing quarterly sales ann, up 24% qr on qr but the best result is the 52% increase in the Nth American market, looks like penetration is being achieved now but the Aust market is static atm.

[sb9]

Very pleasing quarterly sales ann, up 24% qr on qr but the best result is the 52% increase in the Nth American market, looks like penetration is being achieved now but the Aust market is static atm.

Agree, still bit of work there to do.

FY20 is the year to watch for them I think.

[Yoda]

Things looking up ? TA s seems a bit better . Maybe start of a new rise ?

[sb9]

Inching into the $3 territory, its been long time between drinks.

[Yoda]

Smashed it today 4%: up up and away .. maybe ....

[GTM 3442]

Smashed it today 4%: up up and away .. maybe ....

It's been quite a nice little performer in the run-up to the results announcement.

[sb9]

Solid result and promising outlook especially in NA and AU markets. Listening to conf call and good amount of information given by CEO and CFO.

[sb9]

https://www.nzx.com/announcements/335755

Nice endorsement by Australian Ethical to increase their stake from 6.47% to 7.76%.

[whatsup]

Eroad wins Air N Z innovation award today.

[sb9]

Eroad wins Air N Z innovation award today.

Nice accolade. Jun qtr update should be out soon and that should give a good insight into how they're tracking especially in NA market (on back of that big corporate win) and relaunched product offer in AUS.

[whatsup]

Further good sales for the first qr, 24% increase on annualised sales, over 100,000 units sold and now in use, good pipeline of growth this year, the AGM should be interesting for all.

[sb9]

Further good sales for the first qr, 24% increase on annualised sales, over 100,000 units sold and now in use, good pipeline of growth this year, the AGM should be interesting for all.

Looks like FY20 is their year of delivery as I was mentioning in earlier posts. NA is tracking well and once AUS kicks into gear, its all set to go.

[sb9]

ASM this Thursday...hopefully there will provide more updates on how Q2 is tracking.

[sb9]

Bit surprised they've not yet released the latest quarter numbers ending sep.

[haewai]

Quarterly out

Q1 US units added: 2904
Q2 US units added: 4345

Good stuff

[sb9]

Quarterly out

Q1 US units added: 2904
Q2 US units added: 4345

Good stuff

Solid numbers...bit late to report though than usual.

Had emailed the company investor relations last week re update and they emailed promptly saying it'll be out this week.

Good stuff and looks like they're looking at ASX listing early 2020.

[winner69]

Like the way they say the loss is down 97% on pcp

Goes with all the other large %ages quoted

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/344704/312463.pdf

Good stuff

[BlackPeter]

Like the way they say the loss is down 97% on pcp

Goes with all the other large %ages quoted

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/344704/312463.pdf

Good stuff

Hmm - revenue growth not too bad (even better than the single and probably somewhat conflicted analyst estimated). Development of earnings (pardon - losses) might be on track for a small end of year profit.

Just wondering what happened to the non tangibles - nearly slashed in half. Did they had to write off the CFO's table calculator or something or is this just the new accounting standards? Not interested enough to check myself, but as a shareholder I probably would be.

[RupertBear]

Anyone still holding this one?

I have a very small holding which I have held for some time but the sp is just meandering along going nowhere and I am wondering whether to bail and invest in somethings that actually moves, preferably up ;)

[Blendy]

Yes I'm in the same boat. I think it's time for me to move to something else.

[RupertBear]

Yes I'm in the same boat. I think it's time for me to move to something else.

yep I am all out now, think there are better places to park my money at the moment. Good luck deciding :)

[audiav]

I’ve been waiting (too long) but will wait some more. Planning on finally buying MFT with any profit. Definitely been an Opportunity cost mistake on my part with this one.

[RupertBear]

I’ve been waiting (too long) but will wait some more. Planning on finally buying MFT with any profit. Definitely been an Opportunity cost mistake on my part with this one.

funnily enough I topped up my MFT today with ERD funds :)

[BlackPeter]

Anyone still holding this one?

I have a very small holding which I have held for some time but the sp is just meandering along going nowhere and I am wondering whether to bail and invest in somethings that actually moves, preferably up ;)

Out for a long time. While I think that the industry has some potential, do I fail to see whats special about this still small, loss making and, to be honest, not that fast growing NZ company to think it will make the race to become the Google of its industry.

Lets face it - collecting road user charges based on mobile data and GPS is not rocket science ... and if we combine that with fleet management, then there are just many larger and more experienced players around.

Best thing which probably could happen to them is that a better off newcomer to the industry buys them out, but not sure I would hold my breath.

[Lunar K9]

Wasn't there a promising quarterly report a whole two months or so back? ERD looks to be moving in a nice direction to me, just because nothing much has happened for a few months (over xmas no less) doesn't seem like a great reason to bail out, nothing wrong with quiet achievers.

MFT is great, but it ain't cheap. Maybe later in the year...

[RupertBear]

Wasn't there a promising quarterly report a whole two months or so back? ERD looks to be moving in a nice direction to me, just because nothing much has happened for a few months (over xmas no less) doesn't seem like a great reason to bail out, nothing wrong with quiet achievers.

MFT is great, but it ain't cheap. Maybe later in the year...

Hope you are right and it is indeed a quiet achiever and it does very well for you. I have held ERD for quite some time for no particular benefit hence my decision to bail. Sure MFT is expensive but I have done very well out of it so far, it just chugs quietly along in the right direction so its been a good long term hold for me. Hope it continues to chug along quietly :)

[Lunar K9]

This one still under the radar, no news is good news? Jarden recently in to it, CFO buying a bit

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/350027/318872.pdf

Thoughts?

[Cadalac123]

Tiny amount topped up
Though looks punt level

[BlackPeter]

This one still under the radar, no news is good news? Jarden recently in to it, CFO buying a bit

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/350027/318872.pdf

Thoughts?

Markets typically don't like loss making companies with dropping growth rates - particularly in a bear market.

Forward PE (if we believe the optimistic analyst prediction for 2022) is still above 50 ... and earnings CAGR is going down (i.e. negative).

Pretty sure there will be better buying opportunities ahead - though not sure whether there will be good buying opportunities, if you see what I mean ;);

But obviously - I could be wrong, Trump might introduce wide spread road user charges in order to annoy his supporters and to lose the next election and for some reason the David under the suppliers of this charging technology might win.

[Lunar K9]

Thanks guys, more or less how it looked to me but wanted to be sure I wasn't missing something. Better opportunities ahead and elsewhere as you say...

[thedrunkfish]

Hmmmm. Good result coming? Not another leaky ship....

[Nigelk]

someone knows something....

[Pricey]

I have no faith in the FCA when I see movements like this.

[bullfrog]

Eroad was deemed an essential service during lockdown, and rightly so, knowing where your staff are is now more important than ever in a Covid world. Been stocking up on these beauties for a while now.

[Jaa]

I have no faith in the FCA when I see movements like this.

Might have better luck with the FMA. :p

[Pricey]

Shows i've been in the UK for too long!

[ziptie]

I have no faith in the FCA when I see movements like this.

Especially when the most the NZX etc ever does is give a slap on the wrist via a trading halt and go "why is your price moving so much" and then nothing further happens unless you are Martha Stewart :p

[Paradox]

Eroad had a bit of spotlight from FMA in 2018 and no doubt, risk & compliance measures would have increased since.
https://www.stuff.co.nz/business/107295497/end-of-the-road-for-regulatory-authoritys-insider-trading-prosecution
Reading this article, perhaps trades under $50k do not come under scrutiny.

Am I right that FMA has so far brought only two cases relating to insider trading ever since it got additional powers in 2013?

[BlackPeter]

Hmmmm. Good result coming? Not another leaky ship....


someone knows something....


I have no faith in the FCA when I see movements like this.


Especially when the most the NZX etc ever does is give a slap on the wrist via a trading halt and go "why is your price moving so much" and then nothing further happens unless you are Martha Stewart :p


Eroad had a bit of spotlight from FMA in 2018 and no doubt, risk & compliance measures would have increased since.
https://www.stuff.co.nz/business/107295497/end-of-the-road-for-regulatory-authoritys-insider-trading-prosecution
Reading this article, perhaps trades under $50k do not come under scrutiny.

Am I right that FMA has so far brought only two cases relating to insider trading ever since it got additional powers in 2013?

LOL. Are we just observing the creation of a new conspiracy theory?

Just wondering whether there could be as well a harmless explanation for this actually quite insignificant (low volumes - 160k in two days - and it appears the "peak"is already over) SP spike:

It appears that in the first week of June one of the two analysts following this stock increased his (or her) recommendation from outperform to buy and increased the "consensus" SP target from $3.40 to $ 4.20:

https://www.marketscreener.com/EROAD-LIMITED-20708126/consensus/

Now - obviously - we all know that analyst recommendations and SP targets are as good as any horoscope ... but it appears one or two smaller retail investors didn't know that and invested some petty cash into a handful of ERD shares after the change of the analyst recommendation resulting into this exciting spike.

Call that as you like, but it has certainly nothing to do with insider trading. Anybody is allowed to read horoscopes and act on their recommendations. Whether it is wise to do that is another question, but it is clearly not illegal. Same with publicly available analyst recommendations.

Discl: neither holding nor conspiring :):

[Paradox]

Both theories are plausible, I guess.

disc: not holding, just indulging.

[thedrunkfish]

Good growth in revenue and great to see the company make a profit. Only question I have is why NTA more than halved?

[BlackPeter]

Good growth in revenue and great to see the company make a profit. Only question I have is why NTA more than halved?

Not really following - but from a quick glance over their balance sheet it looks like they significantly reduced cash (negative cash flow) and increased intangibles.

Not sure this alone would result in halving the NTA (did it?), but it clearly won't help to support it.

[thedrunkfish]

Not really following - but from a quick glance over their balance sheet it looks like they significantly reduced cash (negative cash flow) and increased intangibles.

Not sure this alone would result in halving the NTA (did it?), but it clearly won't help to support it.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/ERD/354920/324753.pdf

[Paradox]

is too much money being spent on R&D? what is the return on research capital? are they better off taking over similar SaaS products and modifying it?


Disc: hold none, but may start researching.

[thedrunkfish]

is too much money being spent on R&D? what is the return on research capital? are they better off taking over similar SaaS products and modifying it?


Disc: hold none, but may start researching.

An interesting question. I find it hard to quantify, however as the tech is not groundbreaking and there are plenty of other players in the market it looks to me like they are going for value added products to enable companies to use their system as a one stop shop.

In my experience once this tech is implemented in companies and staff have become proficient with its use they will be reluctant to change.

[bullfrog]

An interesting question. I find it hard to quantify, however as the tech is not groundbreaking and there are plenty of other players in the market it looks to me like they are going for value added products to enable companies to use their system as a one stop shop.

In my experience once this tech is implemented in companies and staff have become proficient with its use they will be reluctant to change.

Totally agree, implementing a new system, training, etc is a huge cost in time and money, so businesses will be reluctant to change unless given a good reason, and one reason may be a new product that just does more. So Eroad’s challenge is to give that chocolate box of options to their existing clients, so they won’t stray, and to do that they need to keep developing new products. 95% retention is pretty damn good, just need to embed themselves into a companies infrastructure so jumping ship will be too painful ;)

Huge potential in Aus, getting a bit of momentum in the US, solid earnings in NZ, possible listing on the ASX, nice.

[Paradox]

I'm listening to the investor presentation now. Market seems to be liking the announcement.

[Paradox]

Key takeaways from the presentation (some questions came from Craig Investment, Jarden, and ACC)



NZ – 21% growth in revenue yoy, inroads in Australia and US. Sales pipeline promising but lumpy in my view
Continued growth in subscriber and monthly output
US is now an established market, however numerous challenges due to current political and economic climate
Future contracted income 14%
R&D to be kept within 18-22% of revenue
Strong US/NZ $ helped
Maintaining consistent cashflow $12M
Privacy is a major theme – within NZ and Australia; will add to legal costs


From memory, IPO was $3. currently trading at $3.10. previous estimates from brokers were approx $3.20;

I'll form a view over the weekend.

Disc: Hold none

[silverblizzard888]

I'm pretty impressed with the numbers and results. Second only to Pushpay in this current climate.

[King1212]

jarden slapped $4.49 on ERD.....

[King1212]

NZX-listed fleeting tracking company Eroad is ready to hit the road, according to Jarden.

The wealth manager maintained its "outperform" rating following Eroad's full-year earnings on Friday, and upgraded its 12-month target price from $3.40 to $4.49.

Jarden analysts Wassim Kisirwani and Wilson Wong say Eroad's current valuation is "punitive" and based on historic issues.

"The business is significantly lower risk than it was five years ago, and with its market value [$221m] largely unchanged, we see a compelling investment case" the pair say.

[BlackPeter]

NZX-listed fleeting tracking company Eroad is ready to hit the road, according to Jarden.

The wealth manager maintained its "outperform" rating following Eroad's full-year earnings on Friday, and upgraded its 12-month target price from $3.40 to $4.49.

Jarden analysts Wassim Kisirwani and Wilson Wong say Eroad's current valuation is "punitive" and based on historic issues.

"The business is significantly lower risk than it was five years ago, and with its market value [$221m] largely unchanged, we see a compelling investment case" the pair say.


I agree with the analysts that the current value of the share looks better now than 5 years ago. However - we don't really know whether the share was good value at that time, do we? Or should I say, we know it was not good value 5 years ago?

From my perspective - ERD's technical solution is not rocket science, and last time I checked they have not been under the top 3 solution providers in their growth market (US) either, i.e. they do have a number of more successful competitors in terms of volume and revenue) ahead of them.

I assume they will survive (at least in Australia / NZ), but whether it will be them who takes the amazon price of the RUC solution providers in the US ... who knows. I feel the the risk for them trailing the pack is not properly priced in at this stage, but hey - this is subjective ...

Discl: don't hold, but still following (on my "curiosity" watchlist);

[King1212]

Saas increases from $55 to $58 permonth.....CEO mentioned about covid 19 track n tracing app....

[BlackPeter]

Saas increases from $55 to $58 permonth.....CEO mentioned about covid 19 track n tracing app....

LOL - Covid 19 tracking ... is this where their expertise is? No wonder they wrote losses year after year for tracking a virus which only emerged end of last year :p. Must clearly be ahead of their time ...

Anyway, happy to leave them all for you :); From a personal perspective I am a bit worried to invest into companies who promise success for the last 10 years or so and are still writing losses (even if this year was close).

Sure - history does not repeat itself, but not sure whether the odds are good for this company being the next big thing.

GLTAH!