RE:RE:RE:RE:Aaaaand More....I get it. This acquisition though changes that. It’s quite transformational. First and foremost, it’s not stock, and you are not waiting for the third party to put out before you see BZI go up. BZI will perform primarily based on NameSilo revenues for the most part.
2nd, with only about 4 or 5 million in equities in the portfolio, 2 million names at 8.95 make the portfolio almost irrelevant.
3rd, the growth rate is phenomenal. Enough that even if you were to cut it back to say 50%, it’s still enough to provide a very handsome return , Taking into account that they are only keeping say .80 or .90 cents per name. It’s still great cash flow. And it’s recurring.
4th. One has to ask themselves what 2.5 million names (2019) is worth to a giant (Go Daddy?, Tucows? Donut?) who’s annual growth rate has levelled off in the single digits? While there are many variables to each past takeover in the space, the library of the names is the key asset. And over all those sales have occurred at 3x and 4x revenue. I don’t expect to trade at 5x revenue like GoDaddy, but even valuing it at 2X revenue and you get a .50 or .60 price point.
5th... Ancillery services could really amp up top and bottom line. I don’t have the exact numbers but consider the Donuts buyout. It’s a TLD (Top Line Domain) owner, so it’s a tad different. But it generated somewhere around say 20 million in domain registries. But it’s ancillery services of e-mails, web hosting etc made almost as much as the registries itself. Just google it.
So, like I said, if you don’t like BZI for it’s investment style, that’s fair. But it’s hard to argue imo with this purchase and the numbers it puts out. And it will continue to put out like that as it’s amost all recurring revenue. And you don’t have to wait for a quarterly report to see how good it’s doing.
Would i I bet the farm in it, no. At .35c I don t think you have to either.