SRTS thanks for the thoughts
I missed the details on that 800k. I’ll have to listen again.
What’s funny about the recurring model is had they announced this back in 2022 when they were killing it, I would have been loading the boat, and been hugely excited. Now that they’ve shat the bed for a year, I’m less enthusiastic about whether they can pull off implementing a new business model. Granted they would still sell the equipment so it would really be running 2 concurrent models.
I didn’t like the tone of the call where they bragged about how they were right last year about the business and how it played out better than they said it would. That’s some serious revisionist history.
I did like that they got their inventory down.
I’m personally not impressed, and I’m in “show me” mode, but I think it may have upside from here, and I won’t be aggressively dumping at 4.
The story for someone who wasn’t burned before might sound pretty good.
Here’s a narrative:
A company that had nearly a decade of outstanding operations experienced a short term hiccup in 2023 due to the way inflation uniquely effected their business. They are now past that part and continue their long track record of growth again. Part of that effort is to implement a new recurring revenue model to get away from the cyclicality of the capex cycle thereby providing a smooth and consistent path of growth.
At the same time they have a pristine balance sheet, strong insider ownership with recent buying, and are trading at very low levels for a medical device maker.
I’m not saying that’s what I believe, but I can see some people finding that narrative compelling, and I’ll admit there is a non-zero, but not large chance it’s true.
AI
