Liberated Syndication Inc. (fka LSYN)

[Value516]

5x FCF, net cash, ~30% EBITDA margins, asset light – Any takers?

I realize no one cares about this micro-cap, but just wanted to point out that despite LSYN having a great year, the stock is even cheaper than before due to the high free cash flow generation through the year.

I blame the lack of IR from the company and the low liquidity. But this is what micro-cap investors live for. I spoke with the company and they said they did not hold a Q3 conference call because "there was nothing new to say". They were similarly surprised this has traded so weakly, as they said "We thought investors would see the cash build up"

https://www.sec.gov/Archives/edgar/data/1667489/000165495418012729/lsyn_10q.htm

From Q1 - Q3 (2018), LSYN has generated $5.4M in free cash flow. At $1.30 per share, the entire Enterprise Value today is only $38.1M. (29.7M shares outstanding, cash balance of $9.4M, debt of $8.7M, and not including $50M+ of NOL's). This is a hosting business - they get paid per podcast, not by hours listented or advertising. So revenue has grown QoQ ($5M in Q1, $5.3M Q2, $5.7M Q3).

Let's assume zero growth, and annualize the current FCF, you get an est. $7.2M of FCF for 2018. A 19% FCF/Enterprise Value yield is crazy for a business that is still growing, proftiable, sticky customers, no debt, and not in crisis.

Am I missing something here?