In light of our successful Gt Biopharma, Inc. (NASDAQ:GTBP) interview March 25, 2021, after which the stock has doubled in price, we have decided to continue with our pipeline of interviews and schedule a call with the CEO and COO of a Business Process Automation and Software Solutions Company.
The company is focused on delivering administrative solutions (mainly HR) to corporations. Their bread-and-butter business is in helping companies administer their insurance plans.
What caught our eye is the potential turnaround now underway. The company has been historically unprofitable, but in the words of the CEO, this was first driven by the need to develop the business and then transform it to achieve most of the perceived opportunity without having issues with competitors.
Now the performance started to improve as the company is signing new clients. Due to the scalability of the business, the CEO believes they could achieve strong profitability already this year. Moreover, this profitability should be stable as over 80% of the current revenue is contracted for at least the next four years.
If the business starts to execute and generate free cash flow, the current valuation would be wholly inappropriate. Even at just 1x P/S which would be woefully low for a growing and profitable SaaS play, the stock would already double.
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