Gorilla Technology: Impressive Growth Vs. Poor Cash Flow Conversion (Archive)
Impressive growth, discounted valuation, but weak cash flow conversion tempers bullish conviction.
This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.
Elevator Pitch
- The revenue and profitability outlook and visibility are robust, as the company is well-poised with a large backlog and a strong pursuit of multi-million-dollar deals.
- The cash flow conversion profile is heavily impaired due to high receivables, likely from major government customers.
- P/E valuations are at a discount, but this is offset a bit by the distortions caused by large delays in cash flow conversion vs. revenue recognition.
- Technicals are bullish but at a key resistance area. Hence, the outperformance vs. S&P 500 may be muted going ahead.
Read the full article here.
Disclosures and Disclaimers
Past performance ≠ future results. Not investment advice. See full Disclaimer.
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