Board: Value Hounds
Founded in 1992, they are an old internet company with a twist. I believe the name was an acronym for "The Ultimate Collection Of Winsock Software" - it used to be a shareware download site (when those mattered).
They have several lines of business. First they are a smaller and less skeezy GoDaddy - domain registrations/renewals and hosted services (email, websites, certificates, etc) which they offer wholesale (OpenSRS) and retail (Hover). The wholesale business has some value added offerings in CMS and billing (Platypus). They also do domain parking/ad sales ('Portfolio') which I consider a wasting business. Finally (and why I'm interested in them) they operate an MVNO called Ting (phone service, think Boost Mobile or Leap).
Historically, domain registration and services have been the bulk of business - between 85-90% of revenue. It is growing, but not rapidly, and is nice profitable (gross margin 20-25%).
Ting has only been around since the beginning of 2012, but it caused the revenue in its reporting segment (Retail) to double from $5M to $10M from 2011 to 2012. According to the FY12 conference call, the gross margins there are 40-50% (http://seekingalpha.com/article/1182351-tucows-ceo-discusses...). This is material for a company with an $85M market cap.
Spitballing it, they doubled subscribers from end of 2012 Q3 to end of 2012 Q4 to 10K and expect the absolute growth in subs to hold up. I think that could be 40K subscribers by the end of 2013. Assuming acquisition costs stay near $100, revenue/sub is $600, and stable gross margins, that's $8-10M more annualized gross profit by the end of the year.
They are not expensive, either: P/S .75, negligible net debt, P/E of 20, and EV/Operating Cash flow ~ 14. Almost nobody is betting against them, the short ratio is 0.2 and TCX isn't heavily traded. They are shareholder friendly, and have been actively buying back stock without the massive dilution common in other technology companies.
I know it's not everyone's cup of tea here (microcap, tech), but it's a value stock. Particularly if you take growth at Ting into account.
Any feedback or criticism would be warmly welcomed. Also, side note, I found Ting before I found Tucows. Sometimes I buy stock in companies I pay that I hate - FBF was a great example before BAC took them over - so the dividend can lessen the sting. I this case, though, I love Ting/Tucows. I could go on and on about how great their service is, but I'll spare everyone.