A revision to my investment thesis in RHTDidn’t Lisa warned us that for revenue going forward they expect steady growth instead of 50%-100% (was 100%, in December 2019)? It said clearly the management conceded the business model they impressed all investors with in the last three years does not work as smoothly as they promised.
I totally revise my perception with the company - at present RHT is still in version 1 and now working hard to upgrade to RHT version 2. Throughout the period since 2017 under version 1 all signed contracts basically is an agreement to allow care providers (Clients) to “sell” to their patients under the iUGO platform. Up till now this business model does not yield satisfactory results at all due to the long time lag for the Clients to get complete paperwork for each individual patients. And then there is the pandemic.
The management, as I speculate, has been working to modify and improve the sources of revenues. The franchise IR mentioned could be just one of a few answers to upgrade to RHT version 2. But we are not there yet and we need clarification.
It is irrelevant to put number on gross margins, revenues, etc., without knowing how things are evolved. And that explained why future new contracts can have a neutral reception only with investors under the current business model.
I invest in this company to see it to turn to version 2 with an improved business model - to succeed in expanding a steady stream of income on top of what they achieved in version 1. That is what “sready growth” means to me.