RE:RE:RE:Breakout
From Tailwinds Did HyreCar Just Hint At Stronger Growth? ByDaniel Carlson- March 6, 2019 This morning HyreCar (HYRE) put out a press release talking about their partnership with Mitek for rapidly onboarding drivers. This is an important update to their business as it will allow them to scale more rapidly, as well as reduce fraud in their system. Also in the release was an update on Annual Rental Days. These technology enhancements have contributed to HyreCar scaling annual rental days from under 400,000 for the fiscal year ending December 31, 2018 to an annualized run rate of over 550,000 rental days through the first two months of 2019. Its a little hidden in the text, what with the Company comparing a run rate after two months to last years full number, but with a little digging we can make this more of an apples to apples comparison. In doing so, it looks like business is going quite well. Heres how the math works: In reviewing prior earnings calls, we know the Company had rental days of 105,000 in Q3 and 93,000 in Q2. Thats a growth rate of 13%. Extrapolating that the growth in Q2 versus Q1 was the same, we can project Q1s rental days was 82,300. This means to hit 400,000 for the year (a number they didnt quite reach), Q4 was 119,700. As an aside, since HYRE didnt hit 400,000, we know that number is high. But, a higher number will diminish this years growth rate, so we are using the high number and expect our numbers might be too low as a result. Looking at Q4 in more detail, if we assume consistent growth through all three months, the quarter looked like this: Oct. 37,900, Nov. 39,700, and Dec. 42,100. Now, looking at the last two months, we know they averaged 45,833 to hit an annualized 550,000. Once again, using constant growth rates, there would have had to be approximately 44,542 rental days in January and 47,125 in February. Keeping the same growth, March could be projected to be 49,858 rental days. This means that Q1 is looking like 141,525 rental days, which equates to a sequential growth of 18%. This is higher than Q4s 14% sequential growth as well as Q3s 13% growth.Thus, it is our opinion that HyreCar has just let the world know that the growth rate is accelerating here in Q1. Looking at the balance of 2019, if growth continues at its current pace, the company is on track to have over 740,000 rental days this year. That is worth about $19.1 million dollars in 2019 revenue. This number doesnt include any growth in dollars per rental day; growth that we are highly likely to see in 2019. The 740,000 rental days also doesnt account for the fact that January and February are typically the slowest months of the year. This was also just confirmed by Lyft in their IPO filing. Yet, if they only come in with that number, they would beat Northland Capitals estimate of $18.9 for the yearsomething I think is very likely to happen. Its our belief that things are going very well at HyreCar. We expect them to continue their growth in revenues and to be cash-flow breakeven in the very near future. Todays press release, with its subtle guidance, provides us with more confidence in this outcome than ever before. Tailwinds'Disclaimers & Disclosures: For a full list of disclaimers and disclosures, please visithttps://tailwindsresearch.com/disclaimer/.