My GAIA Earnings Preview

Posted on November 1, 2021 by Brad Steveson

Gaia (GAIA) is set to announce Q3 2021 earnings today, November 1st after the bell. The company will host their Earnings Call at 4:30 p.m. Eastern time. I follow Gaia in my Breakout Room on the Breakout Investors Platform and it is one of my favorite holdings, especially at the current share price, trading at $10.24 as I write this. Why? It’s just math. When I look at the company’s past performance and model out my future performance expectations, the stock screams buy to me.

What is GAIA? Gaia describes themselves as a global conscious media company committed to evolving consciousness by creating a transformational network that empowers a global conscious community. Their subscription service provides access to a vast content library that caters to a unique and underserved member base. Many would consider their content “strange” or “out of the mainstream”, but Gaia believes their total addressable market is tremendous. I believe the company’s performance indicates they are correct.

So back to the math.  What do I expect this afternoon when Gaia announces earnings?  Well, if I have done my homework correctly, then Gaia should post a pretty nice quarter. I will summarize my estimates as follows: 

I also expect to hear updates on their $299 live events offering and future targets on EBITDA margins, content spending and CAC (customer acquisition costs).

Where do I get these numbers? By creating an operating model and forecasting the things I have been able to learn about the company with reasonable and researched assumptions. I believe the company hit an inflection point last quarter that the market has largely ignored. However, if these numbers are right or at least in the ball park, the headlines should focus on the idea that GAIA just moved from less than 650k in earnings to over 2.2m in earnings (and growing) sequentially. Perhaps the market will realize that GAIA is undervalued.

We only have a few hours to find out. Stay tuned and check out my Breakout Room if you’d like to join us for discussion on GAIA or other investment ideas. You can also review and comment on a more detailed version of my earnings forecast and assumptions in a research post I just published today. After a simple registration, most of the content on the Breakout Investor Platform is free.

Disclosure: I am long GAIA and may buy or sell shares at any time.

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