RE:RE:RE:Wake up in 6 months.......Not to quibble on timing Homework, but Q4 has been released in mid-May for the past two years. But, yes, I believe it is possible to reach $3.00 within 3 months. But some things need to happen.
The factors that I'm looking at are:
- I project Q3 EBITDA of .04/share. At an 11x multiple that equates to $1.76 share price. My Q4 projection, which I'll review after Q3 is in, is for .06/share EBITDA or $2.64 share price.
- 12x F2024 is the top multiple amongst the 3 brokerages covering QTRH. The range is 8x to 12x with an average of 10x. I've used 11x because I think the low estimate is too low and 11x is the midpoint of the other two;
- 11x seems reasonable based on peer group although much depends on the identified peer group. The three most comparable peer group companies imo are Kapsch (8.7x), Iteris (11.4x) and Verra Mobility (10.8x). Both Iteris and Verra seem to have wind in their sails so the multiple could move up;
- Management seems to have taken an under-promise/over-deliver stance so results could surprise to the upside;
- The CEO could be a significant positive event;
- Significant contract(s), after directionally demonstrating to the market in Q2 that they can be profitable at implementation, could be a positive; however, there may be a negative credibility overhang on this point; and
- The market likes to be ahead of the curve, particularily brokerages and institutional investors.
For reference, the average target of the 3 brokerages covering QTRH is $1.72. There was one upgrade after Q2 ($1.70 to $1.80). There were no multiple expansions.
Let's wish all good luck.