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shakerman640on Jun 18, 2015 1:56am
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Salman Partners: Top Pick rating and $4.50 target for UR
Salman Partners: Top Pick rating and $4.50 target for URAccording to Salman Partners:
https://is.gd/agGSSk
JUNE 18, 2015
URTHECAST CORP.
RECOMMENDATION: TOP PICK
12-MONTH TARGET: $4.50
Opportunities Abound After a Successful HRC First Light Event
UrtheCast held a First Light event in New York City on Tuesday where it presented its first production-quality HRC (high-resolution camera) videos to an audience that included investors, analysts, and the press. We attended the event and from what we can tell, the quality of the video was as promised: 1-metre resolution, no jitter, and clear visibility of cars and trucks. Management highlighted the richness of their video data — 20-megapixel frames at 30 frames per second — and the lengths they went to produce the stability of their final product.
Little Technical Risk Remains as We Approach HRC IOC
With first light behind us, the company expects to declare HRC IOC (initial operational capability) towards the end of July. Management commented that technical risk no longer keeps them up at night; rather they fear not being able to fully capitalize on the opportunity at hand. The company has been getting very positive feedback from its customers. Some have said that the latest samples really opened their eyes to the richness, usefulness, and uniqueness of UrtheCast's video product.
The company is heading to Washington, DC next week to attend the most important geospatial (i.e. earth observation) conference of the year, GEOINT (June 22-25). Prospective buyers of geospatial data are expected to be in attendance.
What Makes HRC Video Data So Valuable?
Think of video as a means to extract additional context beyond what geospatial scientists are accustomed to. In rendering each video, UrtheCast characterizes the precise motion of every object in the scene, even shadows. So while a geospatial data provider like DigitalGlobe can tell you precisely what a target looks like and where it's located in the world, UrtheCast can also tell you whether it's moving, how fast it's moving, and what else is moving. UrtheCast can even tell you how tall a target is by examining how the shadow it casts changes over the duration of the video.
What Makes the Web Platform So Ground-breaking?
The company is “democratizing” access to true geospatial data by abstracting away the complexities involved with procuring, processing, and storing petabytes of raw data. Through an API (application programming interface), third-party developers will have easy access to a constantly refreshing geospatial layer — not just true colour imagery, but also other information products such as vegetation indices. At the opposite end of the supply chain, the same platform allows third-party geospatial data providers to trade data for a share of revenues. Analytics support the entire process to encourage a constant supply of fresh data for the most popular regions.
Valuation and Recommendation:
We are increasing our 12-month target price to $4.50 per share (from $4.00 per share) and maintaining our TOP PICK recommendation on the shares of UrtheCast. Our target price is based on the average value implied by the company’s EO (earth observation) and social media prospects, which we derive from a DCF and venture capital-style model, respectively.