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Banxa Holdings Inc V.BNXA

Alternate Symbol(s):  BNXAF

Banxa Holdings Inc. is a Canada-based company, which provides a financial technology platform. The Company’s principal business activity is being a payment service provider to global cryptocurrency exchanges. The Company’s products include On & Off Ramps, NFT Checkout, OpenRamp and Token Listings. It offers extensive global and local payment options resulting in conversion rates up to three times higher than credit card-only solutions. Its fiat-to-crypto On & Off Ramp solutions enable users to conveniently and securely convert traditional fiat currencies into cryptocurrencies. Its product is a full-stack solution, including UI, Identity know your customer (KYC), Payments, Crypto Liquidity Management and Customer Support. Its NFT checkout solution is offered both in the primary and secondary markets. OpenRamp offers a streamlined solution for on & off ramping, enabling users to effortlessly transition between traditional financial systems and the decentralized blockchain world.


TSXV:BNXA - Post by User

Comment by rankininleton Mar 03, 2021 5:42pm
126 Views
Post# 32710959

RE:Some Observations

RE:Some ObservationsNice to see the Dec 2020 financials today, including the dramatic increase in TTV and revenue. I think it's safe to say BNXA has a current annual run rate of $20-$25 million.

Interestingly, if BNXA traded at the same valuation of VYGR it would be ~$56.40/share.

I hate to make that kind of comarison, though, since VYGR is overvalued by many multiples.

I have an accounting background, so s few cautionary notes too:

1) While the cost of sales have been decreasing as a percentage of revenue, the salaries and G&A expenses have been increasing in lock step. Loss from operations is only a little less in 2020 than in 2019. It will be interesting to see if there's a meaningful change in the next quarter, when we are expecting even higher revenues.

2) The listing expenses were offset by a gain on value of inventory + foreign exchange. While these are legal accounting measures, investments and foreign exchange can work against a company, too, and is qualitatively different than actual revenues.

3) The cash flow statement also indicates they are not out of the woods yet, despite revenue increasing by a huge percentage. While part of this can be attributed to the listing expense, factoring that out cash flows were still minus $2.5 million vs. minus $1.0 million in 2019. This was largely offset by $2.5 million in loans during the quarter.

I'm a BNXA investor and plan to hold long term. I comfortable with placing a fair value on the shares at 10x revenues, which I know is less than competitors, but I'm conservative. That would put the market cap at ~$200-250 million. With a fully diluted float of 45 million, that suggests a fair value of between $4.40 and $5.60 per share.

That is my two cents. I agree that we COULD see a much higher share price, since many investors in the current environment won't be inclined to look at the numbers so critically. I wouldn't be surprised to see a share price of $10.00/share this year, perhaps higher.

I only offer my numbers as a check on overexuberance. Feel free to plug your own numbers in.

GLTA


Thanks for the above post BCDUDE,


To solidify my comfort zone, I ran my own numbers with following variables:

2.0 % margin
50 % jump mo over mo for February 2021 just like BIGG 
10% jump mo over mo for balance of year

Using 12 months out forward sales at 4x I get $5.35 stock price.

Now, one can argue all day about variables.  One can argue about bit coin price, competition, regulatory framework, growth, adoption rates, bla bla bla

Folks are comfortable saying $10.00 bucks.  I get it now.  BNXA is exploding on the growth side.  January 2021 ttv of 53mm would  be ~ 227mm for month of January 2022 going with mo over mo of 50% for Feb 2021 and 10% mo over mo for next 11 months.

Ten bucks is 4 x current price.  Nice risk/reward in my view.

Wow!

Management not so great at floating the story so shares bought now are cheap IMO.
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