ERD - ERoad. (Transport sector technology)

[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]

[FONT="]NZX-listed fleeting tracking company Eroad is ready to hit the road, according to Jarden.
[/FONT]
[FONT="]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.
[/FONT]
[FONT="]Jarden analysts Wassim Kisirwani and Wilson Wong say Eroad's current valuation is "punitive" and based on historic issues.
[/FONT]
"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 . 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!