$APSI is virtually unknown and flying under the radar, so take a look at why this is a high-potential opportunity! >>
Last year, Aqua Power Systems, Inc. (OTC: APSI) purchased 100% of transportation trucking company Tradition Transport and all of its subsidiaries. For the full fiscal year 2022, sales are expected to be in the $125 million range, with a net profit of $4.5 million. In 2021, Tradition reported revenue of $87,695,384 and a net profit of $2,986,945. In 2020, the company generated $49,992,274 and a net income of $1,738,623. APSI moved from a shell OTC company to a bona fide asset-based transport/trucking firm with seven subsidiaries.
Yet, APSI trades at a market cap of only $5.7 million.
Tradition Debuts New Intermodal Services
Tradition, through its subsidiary Freedom Freight Solutions, added new intermodal services through its drayage inbound and outbound freight business at its facility in the Port of Savannah. The seamless intermodal strategy is designed to make freight movement faster and more efficient for the customer.
Tradition is adopting new technology for its large base of some 500 active customers. It serves a diversified base of industries such as building materials, automotive, manufacturing, containers, and food. This broad spectrum gives Tradition a stable client footprint.
APSI also owns an asset-based fleet of 162 company-owned tractors, some 303 trailers, and six warehouses totaling two million sq. ft. In terms of assets, Tradition Transport is a solid investment that delivers revenue and net income via this fleet. It also acquired Anchor Bolts & Fasteners, LLC, a company that manufactures bolts and fasteners as well as custom plates, cages, and embeds. Tradition's goal is to acquire another 200+ tractors and some 400 trailers in 2023 and 2024.
More deployment centers for Tradition are scheduled to open in Savannah, Nashville, Dallas, and Indianapolis. M&A is on the horizon. In addition to its organic growth structure, Tradition Transport is already reviewing future potential buyout candidates related to the businesses.
Tradition is also planning to grow its international business, and already serves freight to and from Mexico and Canada.
APSI Stock Is Undervalued: A Significant Opportunity For Investors
Tradition's parent, APSI, has just 17,204,180 shares outstanding, and its pricing remains undervalued in the transportation industry. By any measurement of revenue, net income, or assets, it deserves better. In fact, it should trade at well above $1 per share—and perhaps closer to $6-7 per share. Financial experts would agree that the APSI market cap makes no mathematical sense as it currently stands.
A valuation based on industry standards compared to 10 competing publicly traded transportation companies finds that the median enterprise LFY valuation in this sector is 1.6X revenues. That would translate into an APSI market cap of some $200 million, based on 2022 full year sales of $125 million.
A valuation based on typical sector multiples — such as the average enterprise based on LFY having 3.2 times revenues — means APSI would have a market cap of $400 million with a share price of $23.25. Even a one-time revenue share price at the estimated 2020 sales of $125 million would translate into $7.26 per share.
APSI May Be One Of Most Undervalued Companies Publicly Listed
APSI may be one of the most undervalued companies publicly listed when industry or sector multiples are applied. APSI has already filed an application with the SEC for an uplist to the OTCQB exchange. A NASDAQ listing is its ultimate goal. When this stock uplists, investors will notice. Investors should keep APSI on their watch lists because of the company’s asset-based acquisitions in the hot transport business — freight, logistics, warehousing, brokerage, leasing, and more.
