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  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Based on the 8-k filed yesterday, we can pretty much figure out Q4 results. Looks like revenue of about $3.8m and net income of $900k, pre-Akimbo acquisition. Also looks like they paid about $100k more in income taxes in Q4 than the other quarters, so I'm not sure what happened with that. Otherwise, net income would have been about $1m.

    This corresponds to 4Q2013 revenue of $2.2m and net income of $50k, up 70% and 1,700%, respectively.
    Mar 10, 2015. 07:56 PM | 2 Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    SGRP is one that I believe is significantly undervalued. Also like ARTX. PLPM is a similar company to PYDS, though I'd probably wait until they report earnings.
    Mar 7, 2015. 12:42 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Even a blind squirrel finds a nut every once in a while.
    Mar 4, 2015. 04:19 PM | 1 Like Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    There's been pretty steady accumulation in the stock for the last few weeks. Hard to say if something is in the works (like a buyout), but the stock has definitely caught someone's eye.
    Mar 4, 2015. 04:17 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Industry average is 15% growth, but that is factoring in a lot of larger companies with lower growth rates. Smaller processors can easily grow at 30% a year, and obviously more, as is the case here. I was probably too conservative with my 2015 estimates by only factoring in 15% growth.
    Mar 3, 2015. 04:28 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    This is what it said in the latest 10Q:

    "Revenues for the nine months ended September 30, 2014 increased 226% to $9,631,000, as compared to $2,952,966 for the nine months ended September 30, 2013. The increases for the quarter and nine months ended September 30, 2014, as compared to the same periods in the prior year, were due to the increases in the volume of credit card and debit card processing transactions, ACH processing transactions, and return transactions processed for our newly acquired customers."

    Obviously, they're not going to continue to grow at 200%+, but I don't see any reason why they couldn't grow at 30%+ a year (roughly 2x the industry average). The model I used for 2015 is only factoring in 15% top line growth.
    Feb 28, 2015. 04:43 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Payment processing is a highly fragmented industry, which is why there has been significant consolidation over the past few years with larger processors buying out smaller processors. PYDS's main growth appears to be from ACH processing (like e-checks and automatic withdrawals for paying bills) which does not have a ton of competition like some other areas. Their credit card processing business still grew nicely last year, but that seems to be a more crowded space.

    Based on some of the price lists I've seen, PYDS is significantly cheaper than industry averages for a lot of their offerings. I'm sure their technology is also very good, but I don't know enough about it to compare it to other competitors. PYDS's gross margins appear to be below industry averages, which makes sense considering their lower prices, but they are able to make up for it with low SG&A, so their net margins end up being at or above industry averages.
    Feb 26, 2015. 09:12 AM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    The shares were granted at a price of $0.17, not $0.

    Additionally, the company was recapitalized back in 08-09. The share count at the end of 2011 was basically the same as it was at the end of 2014.
    Feb 24, 2015. 04:10 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    There's some reviews for it on itunes.

    http://bit.ly/1zAAyQU

    I really don't know what the potential is for Akimbo's mobile applications. I think most people primarily use it as just a regular debit card. But it seems like it has a pretty good following with about 11,000 likes on facebook.
    Feb 23, 2015. 04:34 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Not really sure I'd call them handouts. They were given options at $0.17 that vest in 2024. Management has done a good job here so I don't really have a problem with it.

    However, I think this company will ultimately get bought out which means those options will then vest immediately, thus reducing the share price common holders get. Obviously, if they get a nice premium for the stock I'm not going to complain over a nickle or two, but it is something to factor in.
    Feb 23, 2015. 04:11 PM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    PYDS doesn't really compete in the retail POS (point of sale) card present market, which is where Apple Pay is going to be mostly used.

    Akimbo already has an iPhone app for transferring money, so I'm sure that will be integrated with Apple Pay.
    Feb 22, 2015. 11:43 AM | Likes Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    They need a share price of $3 to get listed, so obviously they will split the stock to obtain the listing. I didn't mention it because it's really not material to the overall story here. What was more important were the financial metric requirements like net income and shareholder's equity.

    A reverse split does nothing to change your ownership percentage in a company. It has a bad stigma because it usually involves bad companies that are falling out of compliance and are trying to maintain their listing...which is not the case here.

    I think a smaller float here may actually be a positive in getting the company the valuation it deserves.
    Feb 21, 2015. 01:11 AM | 1 Like Like |Link to Comment
  • Why Payment Data Systems Still Has Triple Digit Upside [View article]
    Thanks. I think his 10b5-1 plan has definitely been a drag on the stock, but it was also one of the main reasons shares could be acquired so cheaply.

    I think the plan has hurt investor confidence more than anything. But based on recent financial results, I think people are starting to figure out his plan has nothing to do with his confidence, or lack thereof, in the future prospects of the company.

    If other insiders starting selling, or Mr. Hoch started selling shares outside of the program, that may be cause for concern. It's probably also worth noting he's had the plan in place for many years (since like 2002 if I remember correctly) and those plans cannot be easily canceled.
    Feb 20, 2015. 01:33 PM | Likes Like |Link to Comment
  • Aviat Networks Is A Value Trap With 50% Downside [View article]
    First off, I held my AVNW stake for like 6 months, that's not exactly short term in my book. I sold because they disclosed some accounting issues, and that is unforeseen and voids any thesis.

    Second, the payment processing industry is actually a great industry to be in and is growing at a steady 15% clip. Not to mention smaller processors are getting bought left and right for an average premium of 4-5x revenue. Both PYDS and PLPM trade for less than 2x revenue and make money, which is not the case for many smaller processors. If you have PRO, I'd recommend you read my last 2 articles on PYDS for better insight into the industry. Or go back and look at my LML Payment articles from a few years ago.
    Feb 3, 2015. 04:44 PM | Likes Like |Link to Comment
  • Aviat Networks Is A Value Trap With 50% Downside [View article]
    PLPM is a little different as they process multi-currency transactions primarily across borders, but the model is basically the same. PLPM spent a lot of time and money building out infrastructure to support their systems, and now they should be able to sit back and collect.
    Feb 3, 2015. 10:54 AM | Likes Like |Link to Comment
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