RE:RE:RE:RE:Avigilon vs the competitionWow that's nonsense. How would you feel if AVO took more profits and let them sit in a sub-2% GIC? They could build a huge warchest and let it fall behind inflation. What makes AVO a strong business is their ability to generate far larger returns by investing in their own operations. The only reason they had higher earnings before is because they were actually building that warchest. Now that they're sitting on hundreds of millions in assets and cash equivalents, why would they stockpile more and let it sit below inflation rates? They already have enough cushion to absorb anything and purchase all they might need. By reinvesting their revenue right away, they're opting for a strong double digit return in the form of even more revenue months later. That's a return that will eventually be captured in the valuation of the company once short-term traders stop being myopic about earnings per share and hope for dividends from a growth company.
By the way there is recurring revenue. That Brazil clip posted yesterday talks about the first phase (primeira fase) of the project, with further expansion already in progress. If satisfied customers aren't recurring revenue I don't know what is. Government in California even posts public tenders in which non-Avigilon bids are considered non responsive. That's brand awareness and clearly recurring revenue.
HamRoveJr wrote: Avo is a good company, it could have stayed at a high multiple BUT no, AF had to go and fu.ck that up, you can grow at a normal pace and remain highly profitable with this business. He is catching market share? THERES NO RECURRING REVENUE TO CATCH! Wtf strategy is catching mrkt share by expanding beyond PROFITABLE means (every extra dollar didn't even pay for itself! Those expenses were mainly in G&A sales and support staff) why do you think those clown analysts are all cutting their price target by 20% or 50% from over last years target? Because one would have imagined he be making money with our money, not hurting profits. Revenue growth comes second, mainly because their goal was to grow faster than the market is expanding. ie. Steal market share, but thats not even that great. Peace out. Your money's better in a garbage GIC for the short term...IMO