Radcom: Product Success And Operating Leverage Will Drive Upside
- Radcom is at the cusp of significant earnings growth due to three key variables: (1) revenue growth; (2) gross margin expansion; and (3) fixed operating expenses.
- A transition to a software-driven model via new product offering - MaveriQ - is rapidly expanding gross margins coupled with well-contained, fixed operating expenses.
- The Q2 earnings release and conference call confirmed points (2) and (3) above. Recently announced contract wins should provide the last leg of the value thesis, revenue growth.
- Radcom's share structure includes only ~8 million shares, about 40% of which are held by two insiders, Zohar and Yehuda Zisapel. Place limit orders, expect volatility.