D-Box in 2019 - my 2 cents (or should i say .18 cents)Hello fellow investors and speculators,
It's been over 2 years since I sold my D-Box shares but I have been lurking in the dark watching D-Box from a far.
Boy, I see that this stock has basically been obliterated again over the last 2 years.
I have seen that they have signed some signifcant deals recently. It seems that almost every April their stock starts to move up and they announce deals. Seems the same going on again.
Okay - do I think the stock is undervalued down here? Of course. Completely 100% undervalued as their residual usage revenue is now over $2M per quarter and bringing in $8M a year in cold hard residual cash. This is where their value lies because its 100% profit margin (from a financial standpoint). Their Market Cap is $30M. That leaves just $20M in value representing all of their other business and assets. We all know, the rest of the business other than the residual income, is worth far more than just $20M.
So why is the stock down here at .18 cents? Well, it looks like this market is never going to give it proper valuation until they stop bleeding cash and start making some profits.
If they keep burning the cash they burn they will have to dilute further again, and the market won't like that.
Also, we are on the cusp of VR becoming mainstream (1-2 years out) so D-Box is still strengthening its position for that explosion and partnering with players that are involved.
If this company ever gets looked at as a take-over target, it will depend on that residual usage income. Its the most important because its the only asset that earns 100% profitability. Their other assets all are money-losing assets.
So what do I think from here? I would say that if we all still believe in this technology, then yes, I would be accumuating more shares down here at these prices as they are incredibly cheap.
We may see a pop up to .30 cents by end of summer. So we are looking at almost a double in 6 months after this summer's blockbusters finish.
This is my short take on everything. I'll be keeping a close eye on it still.
Full Disclosure: I do not have any position in D-Box currently.