SS- ESOA gross margins
Just looked over the last 4 qtrs starting with the Sept qtr 2023. Gross margins were 12.1%, 12.7%, 10%, and 7%. So I don't know where you're getting 15.3% gross profit margins. Either way, my position is, with backlog of $229M as of Sept 30, 2023 vs $142M as of Sept 30, 2022, they will have better quarters in general going forward, especially if their strong revenue growth trend continues. Here is a look at growth in revenues yoy, with fiscal year ended Sept 30. 2021, 2022, and 2023 revenues were $122M, $197M, and $304M. So revenue growth has been 61% and 54% yoy for the last two years. In the Dec qtr 2023 revenues($107M) were 57% higher than Dec qtr 2022 revenues($68M). Going by this trend, Dec qtr 2023 revenues should be at least 50% higher than in the Dec qtr 2022.
So going by their weaker qtrs over the last year, the Dec 2022 quarter was $60M, with margins of 10%, and eps of -$.01, and the Mar qtr 2023 was $53M, with gross margins of just 7%, and an eps of -$.11. Now if the Dec qtr 2023 comes in with 50% higher revenues, that would be $90M, and I doubt very much that margins will be only 10% anymore, plus with so much greater revenues, earnings will be way more than $.01. So would be the case in the weakest Mar qtr, and in fact might even be positive in 2024 ! Therefore my $.75 eps estimate assumes an actual gain for the Dec 2023 and Mar 2024 quarters combined, and more growth over the June and Sept qtr 2023 in 2024 again.
In fact, if the superb growth continues, this could be a $15+ stock within six months IMO.
AI
