A special feature from Redditor: u/PradoMV96
APPS, also known as Digital Turbine, is a company that works at the convergence of media and mobile communications, delivering end-to-end products and solutions for mobile operators, device OEMs and other third parties to enable them to effectively monetize mobile content.
Essentially what Digital Turbine does is this: They make it easier than ever for people to frictionlessly discover new apps, for operators and OEMs to build new revenue streams, and for advertisers to reach users at scale.
The past three quarters have proved to show consistently strong numbers, quarter after quarter and year after year. This past earnings call for their most recent quarter was posted back in February on the 10th. Their third-quarter revenue was $36 Million which is the company's all-time high revenue and it shows an 18% growth when compared to the fiscal third quarter of 2019.
Even better, they reported a $12.5 Million growth in their cash balance and they reported ZERO DEBT. Here is the DD on what I have said in terms of their growth and zero debt report.
Not only did Digital Turbine post incredibly positive earnings, reporting their all-time high revenue, they also confirmed an acquisition. APPS purchased "Mobile Posse" for a reported $66 Million. This is an incredibly well-done business for multiple reasons.
They achieved 2019 revenue of $59.1 million, a GAAP Net Income of $4.5 million and a Non-GAAP Adjusted EBITDA of $12.8 million
They have reported rapid revenue and profitability growth over the past 5+ years
They have a highly profitable, recurring business model with gross margins approaching 50% and EBITDA margins in excess of 20%
The acquisition of Mobile Posse brings Digital Turbine strategic partners which are Tmobile and Metro PCS
The best part of everything I have just mentioned is that it will be reflected during their next earnings call which is on June 1st. Here is all the DD on everything I had just mentioned regarding APPS acquisition of Mobile Posse.
Another thing that has flown under the radar that they have recently done is this: On February 10th, Digital Turbine announced their new Global distribution with LG Electronics. This is a huge deal for APPS, it'll definitely be reflected upon their next earnings call and all I can see from this distribution partnership is an increase in revenue. The distribution partnership plus the acquisition of Mobile Posse, all this will do is increase their revenue by a ton. It's amazing news, but yet both of these have gone under the radar.
Target Prices & forecasts:
After everything I have just mentioned, Canaccord Genuity analyst Andrew Moldow increased Digital Turbine's target price from $8 to $12 dollars.
Finviz currently sets APPS target price to $10
CNN money currently has 6 analysts offering a price forecast for Digital Turbine Inc at a median price target of $10.00, with a high estimate of $12.00 and a low estimate of $7
My final thoughts and comments on this stock/company:
I personally have invested $1000 into APPS, I bought 262 shares a month ago on April 2nd when I first began hearing about this company.
I have also bought several long calls a month ago that have already been raking in profits for me as well.
I genuinely do believe that they will reach $10-15 by the end of the year. I believe so because of all their recent acquisitions and partnerships they have made, plus they have zero debt and they reported their highest ever revenue the previous quarter.
They are so close to $7 dollars, which is CNN's lowest estimate price target, which again adds to why I believe they will reach past the $10 mark
At the end of the day, this is just thorough research on APPS. What you decide to do, whether purchase or not. Or if you do decide to purchase and you buy a little or a lot, that's all on you. Like I tell everyone, Please do your own DD as well before you ever hit submit when purchasing a stock or an option.
Please read the articles and links I have clipped into this DD so you can have all the knowledge possible to make a well-informed decision.
I hope this DD helps you out and I hope you liked it :) Have a great weekend guys!! :)
TL;DR: APPS = GREAT BUY