Boardwalktech about to turn the corner

Posted on August 22, 2021 by Florian Buschek

I have been covering Boardwalktech BWLKF BWLK.V (disclosure: long and adding) for a few months now at the Breakout Investor Platform. The price has come down a lot recently and I have been taking advantage to significantly add to my position. Here is why:

Management is delivering. They are converting old customers on perpetual licence to a SAAS type model. They are adding new customers on top of the already highly impressive list and they are executing on “Land and Expand”. The company is debt free with very high gross margins and the sales pipeline now exceeds $9 million, nearly double the level a year ago. So why has the stock sold off? Boredom and lack of sales growth (you have the legacy business declining and SAAS revenue increasing, thus offsetting each other).

The just reported quarter and full year was as of March 31, 2021 so some time ago. Q1 ER is imminent and should give us a more timely update. Frankly, what investors were excited about in the beginning of the year is simply not reflected in the numbers …. yet.

In that light we recently caught up with CEO Andrew Duncan and CFO Charlie Glavin (both are top notch with relevant expertise and experience in enterprise software sales, finance, buy side, etc) in one of our Breakout Investors Calls With Management. There are several things that made me even more bullish than before.

The bottom line is you have a well funded SAAS company with a unique platform and an extremely strong management team that is about to inflect by becoming profitable by year end and showing sales growth the first time in years, maybe even in a few days. What is not to like? By investing now we are Ahead of the Curve.

I highly recommend watching the video. Andy gave several application examples, which is very helpful to understand what the product is all about and what the ROI is for the customer.

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Steve Kraus

I didn’t here is comment on R&D–thought he said they didn’t spend anything. I saw the same think happen with ISDR with it taking a lot longer to get the market paying a SAAS multiple when they had a core business declining and the SAAS was the new add on…I wonder how much of their “land and expand” strategy is really ongoing customization versus a “platform”. I was building something like this at Credit Suisse buried inside CS Holt and what killed us was the customer always wanted a new “customized spec” added on every 6 months.

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