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eatwellandcover (37.06)

October 2012




October 24, 2012 – Comments (0) | RELATED TICKERS: TDC

This company is a Monster.  This is a play on big Data and data warehouse.

Everyday we create more and more and more data.  This is company that allows other companies to actually turn that data into usable information.  I work in IT recruiting and to speak in broad terms.  Data Warehouse is always hot.  And more and more companies are realizing the ROI on data warehouse makes them leaner and more efficient.

The company is on pace to do 2.66 billion in revenue this year.  Compared to 1.709 billion in revenue in 2009

That is roughly 55% sales growth over a 3-4 year period. 

Current Market Cap is 11.66 Billion so it is valued between 4-5 times sales.  Which is not cheap.  But at 55% sales growth they are priced right.

Even if they only grow sales 25% over the next 3-4 years and their valuation slips to 4times sales they will be valued at 13.3 billion.  a 13% gain.  That is my worst case scenario.  So that is the risk side to this.

The reward side is the company continues at 50% sales growth every 3-4 years and their valuation stays in the 4-5 times sales.  If the company grows 50% in the next 3-5 years and is valued at 5X sales.  The market cap would be 19.95 Billion vs 11.66 Billion today

For a 70% gain over 3-5 years which will clearly outperform.

Personally, I believe this company is a monster.  And once the economy gets going companies will expand their data warehouse efforts and invest in latest/greatest technologies.

a Double in 5 years = 20% annual gain

Believe  [more]

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