GEO Investing

3pea international3PEA International (TPNL) reported record Q4 2014 financial results, prompting GeoInvesting to initiate a position in company shares.  TPNL is a payment solutions company that focuses on providing prepaid debit program management and processing services. We are buying shares of TPNL as we feel they could reach $0.80 to $1.00 based on these record Q4 and 2014 full year results:

  • Total revenues in the fourth quarter of 2014 increased 156% to $4.9 million compared to $1.9 million in the same fourth quarter of quarter 2013.
  • Net income in the fourth quarter of 2014 was $2.8 million, or $0.07 per diluted share, compared to net income of $0.4 million, or $0.01 per diluted share in the year-ago quarter. Non-GAAP EPS for Q4 2014 of $0.08 vs $0.01. *the company is not paying taxes and the 10-k has not been filed at this time, so we are unable to be completely ascertain if there were any one-time gains in this quarter.
  • Total revenues in 2014 increased 63% to $10.3 million compared to $6.3 million in 2013, surpassing previous company guidance of $9.25 to $9.75 million.
  • Net income in 2014 was $2.6 million, or $0.06 per diluted share, compared to a net income of $0.6 million, or $0.01 per diluted share in 2013.
  • The board of directors approved a 2.7 million share repurchase program. The Company has since repurchased and retired 2.4 million shares, or approximately 6% of the common stock outstanding, as part of a debt settlement totaling $0.7 million.

Bullish Company Commentary

Bullish company commentary from 3PEA International management:

“2014 was a breakthrough year for our Company, as we experienced record revenue and net income,” said Arthur De Joya, Chief Financial Officer, 3PEA International, Inc. “Much of this growth is attributed to the continued traction in healthcare reimbursement payments, pharmaceutical co-pay assistance programs, and donor payments for source plasma using our PaySign brand of prepaid debit cards. Using the PaySign Platform, we can quickly design and implement comprehensive solutions for a variety of industries that are customizable and cost effective for our customers.”

“We’ve also internalized our sales and marketing teams, which we will leverage to further penetrate the growing plasma industry, sign additional customers in the pharmaceutical space, and enter into new targeted verticals, such as automotive, retail and payroll, among others. This has resulted in the most robust pipeline of potential customers in our Company’s history.

“Going forward, we anticipate an acceleration in our business. As we aggressively pursue new customers in our traditional plasma and pharmaceutical markets, and penetrate other targeted verticals with our PaySign payment solutions, we are confident that our overall margin structure will continue to expand in 2015 and beyond.”

We began tracking TPNL in October 2014 (shares were trading at $0.25) due to management forecasting record revenue and net income for 2014. In our 2/27/2015 email we stated we believe TPNL will post strong Q4 2014 results, but it is unclear if results will be sustainable. Please reference our full reasons for tracking from our 10/13/2014 email for more color on the story.

To stay ahead of the market with GeoInvesting arbitrage and learn about investment ideas not yet digested by the market, Sign up now for More Research and Insight