Singular Research's Private Client Webinar 10/27 at 12pm PDT

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Wednesday, October 27 at 9 am PDT

 

 

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Join us for a private client webinar with CEO Kevin Roycraft of Adams Resources & Energy, Inc. (AE) on Wednesday, October 27 at 12 pm PDT. There will be an opportunity for 1 on 1s with Kevin Roycraft from 12:30 to 3 pm PDT.

Adams Resources & Energy is primarily engaged in the business of crude oil marketing, transportation, and storage, and tank truck transportation of liquid chemicals and dry bulk through its two wholly owned subsidiaries GulfMark Energy, Inc. and Service Transport Company. Q2:21 results were strong driven by a continued improvement in the economic backdrop, including increased demand for crude oil and a higher price environment. The outlook for crude oil remains positive till 2022 which bodes well for AE. We decrease our target price to $38.50 (earlier $39.75) and maintain our rating at BUY.

Singular Research's Private Client Webinar 10/14

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Thu, Oct 14, 2021 at 9 AM PDT

 

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Join us for a private client webinar with CEO Jason Les and VP of Capital Markets Phil McPherson of Riot Blockchain, Inc. (RIOT) on Thursday, October 14 at 9 am PDT.

Riot Blockchain is the largest publicly traded cryptocurrency mining company in North America. Recent large-scale purchase orders of Antminers and the acquisition of Whinstone Mining has positioned the Company to significantly increase its Bitcoin mining hash rate. We initiate with a BUY rating and a $50.00 price target.

Socket Mobile: An Amazing Economy Re-Opening Play

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Socket Mobile: An Amazing Economy Re-Opening Play

Socket Mobile is a leading provider of mobile data capture solutions. Its products include stand- alone barcode scanners, attachable barcode scanners, and RFID/NFC readers/writers. The primary end markets for its solutions are retail, commercial services, logistics, and healthcare.

 

September 9, 2021

Price (as of close on Sep 8, 2021)

$6.81

 

Rating

BUY

 

Price Target

blocked

 

The Company announced strong Q2:21 results, delivering its fifth consecutive quarter of operating profitability. Revenue rose 119% YOY. Management expects growth to remain strong in the near term led by retail as the economy re-opens. We increase our target price to blockedblocked) and maintain our rating at Buy.

 

sckt 2q f 2021

 

Q2:21 Highlights

➢Q2:21 revenues were $5.9 million, up 119% from Q2:20 driven by strong demand in the retail industry from the re-opening of the economy following the ease of pandemic restrictions.

➢ Gross profit for Q2:21 was $3.2 million, compared to $1.3 million in Q2:20. Gross margin increased 460 bps YOY to 54.6% in Q2:21.

➢ Adjusted EBITDA was $1.2 million in Q2:21, versus a loss of $0.5 million in Q2:20 due to higher revenues and lower operating expenses (as a % of sales).

➢ Net income was $2.6 million in Q2:21 or $0.27 per diluted share versus a loss of $0.7 million or $(0.13) per diluted share in Q2:20.

➢ SCKT expects its NFC reader products to generate meaningful revenue from 2022 onward.

➢ We adjust our estimates based on the quarter end results and management’s commentary. We increase our target price to  blockedblockedblockedblocked We maintain our rating at Buy.

 

PRIMARY RISKS

➢The Company is highly dependent on application developers to integrate SCKT’s scanning products into their applications. If these applications are delayed or are unsuccessful, it could result in less business for the firm, thereby negatively impacting sales.

➢The sales are dependent on a limited number of distributors. Thus, the loss of any one distributor may have a material adverse effect on future operating results and financial conditions.

 

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NV5 Global: Strong Revenue Visibility Means Strong Price Target

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NV5 Global: Strong Revenue Visibility Means Strong Price Target

NV5 Global, Inc. is a provider of professional and technical engineering and consulting solutions in the infrastructure, energy, construction, real estate and environmental markets. The Company’s clients include the U.S. federal, state and local governments, and the private sector.

 

August 27, 2021

Price (as of close on Aug 26, 2021)

$102.34

 

Rating

BUY

 

New Price Target

blocked

 

NV5 Global, Inc. (NVEE)

NVEE reported Q2:21 revenue growth of 10.3% and EPS gains of 44%.  Backlog remains strong at $603 million, ensuring revenue visibility. We increase our target price blockedblocked and maintain our BUY rating.

nvee 2q5 aug 2021

 

Q2:21 Highlights

Q2:21 revenues increased 10.3% YOY to $179.5 million, primarily due to growth in the Infrastructure (+12.2% YOY) and Business Technology Services (+19.6% YOY) segments. The Company exited the quarter with backlog of $603 million.

➢Adjusted EBITDA increased 27% YOY to $34.2 million, while adjusted EBITDA margin increased 250 basis points to 19.1%. Adjusted EPS rose 44% to $1.34.

➢NVEE generated $6.2 million from cross-selling in Q2:21 while also securing key contract wins across all segments.

➢The Company produced $14.1 million of cash flow from operations and ended Q2:21 with cash of approximately $113 million on the balance sheet, providing plenty of funding for future acquisitions.

➢ Contracts delayed by the change in administrations are moving ahead and NVEE could be a prime beneficiary of the $1 trillion infrastructure bill making its way through the US Congress.

➢NVEE increased its 2021 revenue guidance by roughly 8% to $705-$727 million and adjusted EPS guidance by 18% to $4.20 - $4.55.

➢Taking into account strong H1:21 results and the favorable H2 outlook, we increase our price target to  blocked and reiterate our BUY rating. Our target price implies blocked for NVEE shares.

PRIMARY RISKS

➢ An economic downturn could restrict the Company’s access to capital markets and slow acquisition-related growth.

 

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Delta Variant vs Bulls AUG 2021 Update

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Wed, Sep 15, 2021 at 6:15 AM PDT

 

Maltbie's Minute on the Market a look back at August 2021 The Delta Variant vs Bulls

 

 

Market breadth & valuations are troubling , Delta variant impact and opportunities in Online Sports Betting, time to reconsider the re-openers ? Rush Street Interactive (RSI) stock of the week. (8/8/21)

 

Singular Research August 2021 Director’s Letter

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Singular Research’s August 2021 Director’s Letter

 

directors letter august 2021 img 1

 

In August, stocks continued to climb higher as the S&P 500 has now increased for seven straight months, its longest winning streak since January 2018. August historically has been one of the worst performing months for stocks; however, 2021’s August did not follow historical trends. Interestingly, Delta variant fears, inflation concerns, and supply chain constraints were not enough to move markets lower. Many believe Fed Chair Jerome Powell’s dovish comments to “support the economy for as long as is needed to achieve a full recovery” outweighed all the other negative market sentiment for the month. Large cap stocks outperformed small caps while large cap growth outperformed large cap value. 98% of S&P 500 companies reported by the end of August with 89% of those companies posting earnings growth; the average upside beat was 16.4% and sales estimates were 4.6% higher. Financials, Communications, and Utilities led the way with 5.1, 5.0, and 4.1% returns respectively while Staples, Industrials, and Energy were the biggest losers with 1.4, 1.1, and (2.0)% returns, respectively. Markets continue higher led by a never-ending dovish Fed. Laissez les bons temps rouler! (Let the good times roll!)

The August Purchasing Managers Index® (PMI) registered 59.9 percent, an increase of 0.4 percentage points from the July reading of 59.5 percent. Similarly, the Conference Board Leading Economic Index® (LEI) increased 0.9 percent in July to 116.0 (2016 = 100), following a 0.5 percent increase in June and a 1.2 percent increase in May. The July PMI reading indicates economic expansion for the 14th consecutive month. The unemployment rate decreased 5.4% in August (5.9% in July) as businesses have started the rehiring process.

 

directors letter august 2021 img 2

 

For the month of August, the Singular coverage list outperformed the S&P 500 and Russell 2000 by 1,016 and 1,068 basis points, respectively. Over the last twelve months, the Singular coverage list outperformed the S&P 500 and Russell 2000 by 9,808 and 8,180 basis points, respectively. Since our 2004 inception, the Singular coverage list has outperformed the S&P 500 and Russell 2000 by an annualized 559 and 539 basis points, respectively.

 

directors letter august 2021 img 3

 

For August, our top three performers were acquired, hence the large monthly price returns and our lack of future price targets. RSI had a strong Q2 earnings report with revenue up 89% year-over-year; the Company increased full year 2021 revenue guidance as well. TA also reported a strong Q2 as the Company’s net income increased to $28.9 million, an increase of $26.8 million from the prior year. Adjusted EBITDA increased to $73.5 million, an increase of 60.6% year-over-year.

 

directors letter august 2021 img 4

 

BBKCF was our worst performer for the month as the Company reported Q2 results that did not appease market participants; revenue increased 24% sequentially which is strong, but apparently not satisfactory for crypto currency investors. ZM fell similarly as the Company posted year-over-year revenue growth of 54%; however, ZM guided for Q3 revenue and adjusted EPS to be weaker than Q2 results. LUNA also had a poor month as the Company’s Q2 results were weaker than expected after the OptaSense acquisition.

 For the month, we initiated on Riot Blockchain, Inc. (RIOT) and Gogo, Inc. (GOGO). RIOT is the largest publicly traded cryptocurrency mining company in North America. Its mining operations are based out of Coinmint LLC’s facility in Massena, New York and the recently acquired Whinstone facility in Texas. GOGO is the world’s largest provider of broadband connectivity for the business aviation market. Its products offer equipment for inflight connectivity, including voice and data services for the North American market.

 

directors letter august 2021 img 5

 

We wish to thank our clients for their support and belief in our process. To learn more about Singular Research and register for a 14-day trial offer, please follow the link below.

 

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Robert Maltbie, CFA
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GreenBox POS: Management’s Execution Is Remarkably Good

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GreenBox POS: Management’s Execution Is Remarkably Good

 

August 26, 2021

 

Price (as of close on August 25, 2021)

$8.58

 

Rating

BUY

 

Price Target 

blocked

 

GreenBox POS, a technology company, develops, markets, and sells blockchain-based payment solutions. The Company's blockchain-based systems are designed to facilitate, record, and store a volume of tokenized assets, representing cash or data, on a blockchain-based ledger. GreenBox POS was incorporated in 2007 and is based in San Diego, California.

 

 

GreenBox POS (GBOX)

In Q2:21, GBOX had revenue of $6.4 million, representing growth of 178% YoY and 36% sequentially. GBOX processed a quarterly record of $440 million in transaction volume, up 40% from Q1:21. In the quarter, the Company made several key acquisitions and business arrangements that have framed GBOX for a successful global launch of COYNI. We have reduced our price target from $33.00 because earlier we did not discount GBOX’s valuation enough since most of its revenue comes in 2022 and 2023. However, after increasing the valuation discount, we reiterate our BUY rating with a blocked price target.

 

sr gbox 9 6 2021 img 1

 

Q2:21 Highlights

  • Revenue grew 178% YoY and 36% sequentially to approximately $6.4 million in Q2:21, compared to $2.3 million for the same quarter one year ago.
  • GBOX processed a quarterly record of $440 million in transaction volume, up 40% from Q1:21’s processing volume of $315 million.
  • The Company deployed COYNI, their smart contract technology stablecoin, in a pilot launch and deposited $5 million in initial seed capital at Signature Bank.
  • GBOX acquired Transact Europe, a Principal Visa and Mastercard member with key licensing assets and a significant processing volume portfolio.
  • Partnered with the Territorial Bank of American Samoa to provide customized payment solutions software throughout American Samoa.
  • We are bullish on GBOX’s long-term prospects. We reiterate our BUY rating with a price target of blocked.

 

PRIMARY RISKS

  • Merchants could be slow in adopting Gen 3 and/or the token. This hesitation could result in lower processing volume and revenue.
  • The joint venture in the GBOX token may be delayed or be less than anticipated.The Company’s performance in linked to the market price of Bitcoin which has high volatility.

 

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Riot Blockchain: Recent Acquisition Is A Testament To Management's Long-Term Thinking

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Riot Blockchain: Recent Acquisition Is A Testament To Management's Long-Term Thinking

 

August 18, 2021

 

Price (as of close on August 17, 2021)

$32.76

 

Rating

BUY

 

Price Target 

blocked

 

Riot Blockchain is the largest publicly traded cryptocurrency mining company in North America. Its mining operations are based out of Coinmint LLC’s facility in Massena, New York and the recently acquired Whinstone facility in Texas.

 

 

Riot Blockchain Inc. (RIOT)

Riot Blockchain is the largest publicly traded cryptocurrency mining company in North America. Recent large-scale purchase orders of Antminers and the acquisition of Whinstone Mining has positioned the Company to significantly increase its Bitcoin mining hash rate. We initiate with a BUY rating and a blocked price target.

 

sr article 8 27 2021 img 1

 

Investment Thesis

  • Riot Blockchain is the largest publicly traded cryptocurrency mining company in North America.
  • Recent large-scale purchase orders of Antminers and the acquisition of Whinstone Mining has positioned the Company to significantly increase its Bitcoin mining hash rate.
  • The acquisition of Whinstone adds 300 MW of capacity (expandable up to 750 MW) and provides Riot with a clear and de-risked path to growth.
  • The declines in network hash rates following the crackdown on crypto mining in China is bullish for North American miners. The decrease in competition has created an enhanced profitability window for miners like Riot.
  • The company is poised to grow revenues and earnings over the near-to-medium term. We initiate coverage with a BUY rating and a price target of blocked.

 

PRIMARY RISKS

  • The Company’s performance in linked to the market price of Bitcoin which has high volatility.
  • Cryptocurrency regulation, both in the United States and internationally, could adversely affect the price of cryptocurrencies and the cryptocurrency mining industry.

 

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