RE:RE:RE:Record Trading VolumeI have been a VHI shareholder for just over 3 years now. Bought it because of the strong growth in revenue. The problem was the revenue growth wasn't resulting in net income improvements - the company was having a hard time becoming profitable. I saw a very well respected analyst say about a year ago that was his issue with the company, that they weren't generating profits. Well, that's no longer a problem. The company has reached the size where all that revenue growth is now producing bottom line results as well.
Looking at the 3rd quarter results, which really lit a fire under the stock price, the net income before taxes jumped from roughly $750,000 a quarter in each of the 1st 2 quarters to $1.8 million. ARR continued to grow, from $39.6 million Q1 to $41.0 million Q2 to $42.6 million Q3. Another thing that is great to see is the ability of the company to generate cash now, as the cash balance has gone from $17.1 million at Q1 to $22.9 million Q2 and now $29.8 million Q3. That's an increase of almost $13 million in 6 months, for a company with a market cap of only $187 million.
There seems to be a lot of room for growth here, as indicated by the CEO in the Q2 comments:
"We continue to see new customer interest in our growing product portfolio in a more diversified fashion than in the past. In particular, our TREAT solution in the Canadian marketplace continues to expand on its leadership position. We are penetrating deeper into core accounts and expanding horizontally into adjacent markets"
Possible we are seeing a very promising long term growth story here, that has now become a good profit/cash generating business, with lots of room to move up.