Pointer Telocation Ltd. (PNTR) research, news, and more from GeoInvesting

Company description

Mon, 07 Oct 2013 04:00:00 GMT

Pointer Telocation Ltd., together with its subsidiaries, provides mobile resource management products and services for the automotive and insurance industries. It operates in two segments, Cellocator and Pointer. The Cellocator segment designs, develops, and produces a line of asset tracking products; stolen vehicle retrieval (SVR) products; fleet management application products, including remote monitoring and control solutions; and end units to retrieve data from various sensors, as well as offers Web access required for the execution of vehicular and fleet management operations. This segment distributes and sells its products to third party operators and distributors in 45 countries worldwide. The Pointer segment provides asset tracking services; SVR services; fleet management services; roadside assistance services comprising towing services, mobile automobile repair services, vehicle replacement services, selling and installing spare-parts, and bodywork repairs; car sharing services; and household plumbing repair services for insurance companies, as well as installation, water damage repair, and water heater replacement services. This segment offers its services through vehicle importers, fleet vehicle operators, leasing companies, and private individuals, as well as through third party contractors and distributors in Israel, Argentina, Mexico, Romania, and Brazil. The company was formerly known as Nexus Telocation Systems Ltd. and changed its name to Pointer Telocation Ltd. in January 2006. Pointer Telocation Ltd. was founded in 1991 and is headquartered in Rosh Haayin, Israel.

Research

Tue, 27 Feb 2018 18:44:21 GMT

GB Pointer Telocation (NASDAQ:PNTR) ($17.40; $140.2M market cap), a leading provider of telematic services and technology solutions for Fleet Management, announced Q4 2017 earnings:

Sales of $18.9 million vs $17.4 million in the prior year and below analyst estimates of $20.1 million
Non-GAAP EPS $0.27 vs $0.22 in the prior year and ahead of analyst estimates of $0.22

Quotes from management:

"During the year, we announced several wins, including two for connected car projects, one with Nissan India and the other with Peugeot-Citroen's importer in Israel, Lubinski. The successful integration of Cielo's technology enabled us to win an important contract in Brazil, with Fibria. Our mobile asset management technology, Cellocator's Nano CelloTrack, lead to a key win in North America. Earlier in the year, we announced that Femsa chose our most advanced fleet management solution which was successfully implemented during 2017. Looking ahead, we are confident of our ability to continue growing our business successfully for the foreseeable future."

Using the midpoint valuation of trailing and forward earrings we feel shares could be worth $21.05 in the next 12 months. We arrive at that midpoint by applying a P/E multiple of 25 on trailing non-GAAP EPS of $1.03 and a forward P/E multiple of 15 on analyst EPS estimates of $1.09 for fiscal 2018.

If we reference EV/S as we often do for recurring revenue models, at 1.8, PNTR shares are approaching the low range of what we consider to be fair value fair value range of 2 to 4 (PNTR Forward EV/S 1.7).

We will be on the conference call later this morning to see if management offers more outlook on fiscal 2018.

Research

Mon, 18 Dec 2017 17:11:10 GMT

GB Pointer Telocation (NASDAQ:PNTR) ($18.10; $145.8M market cap), a leading provider of telematic services and technology solutions for Fleet Management, announced Nissan India has selected PNTR to provide part of the technological solution of the NissanConnect platform, in cooperation with InfoTrack Telematics.

"We are extremely proud that Nissan India has chosen Pointer's hardware as the telematics control unit for their connected car technology solution. We feel privileged to be part of this innovative journey, inspired by Nissan's Intelligent Mobility vision, and see strong growth potential as it provides significant added-value to both customers and car makers. We see this as a first step with Nissan and Infotrack Telematics and we hope our successful work together will allow us to penetrate Nissan in other countries. Furthermore, India itself is phenomenal and under penetrated market for telematics, and we are excited about the new telematics opportunities we envision there.

Research

Wed, 15 Nov 2017 16:53:02 GMT

GB Pointer Telocation (NASDAQ:PNTR) ($18.62; $150 m market cap), a leading provider of telematic services and technology solutions for Fleet Management announced Q3 2017 results:

Sales of $20.2 million vs $15.9 million in the prior year and ahead of analyst estimates of $19.3 million
Non-GAAP EPS of $0.28 vs $0.18 in the prior year and ahead of analyst estimates of $0.20

Quotes from management:

"We have recently seen increased interest in Cellotrack Nano, our new solution for Mobile Asset Management. We have a number of prospects undergoing evaluations and we believe it will be a long-term growth engine for Pointer. We are also pleased with the increased penetration of our connected car solution following our intensive R&D and marketing efforts over the past few quarters. Pointer's continued solid results represent the ongoing successful execution of our long-term growth strategy."

We added PNTR to our GeoBargain list on June 19, 2017 when shares were trading at $11.98.

Research

Tue, 03 Oct 2017 14:31:55 GMT

We have lightened up our long position on GeoBargain PNTR

In May 2017 we stated we were keeping a close eye on telematics company PNTR as the Company continued to report strong quarterly earnings and continues to expand its SaaS business segment. The stock was trading at $10.40 at that time. Shares have been on a two month tear, rising from lows of $9.95 on August 7, 2017 to new highs of $17.65 in yesterday’s trading session. Shares have now passed our near term price target of $16.65 which we highlighted in our July 11, 2017 article, “This Potential SaaS Multi-Bagger has Been Unnoticed By Wall Street – But Not For Long”. Shares were trading at $12.30 at the time of our article. We have now trimmed a part of our long position, but still remain long. As mentioned above, shares did have a brief dip on the heels of a class action lawsuit from early August 2017. While the lawsuit has not been resolved yet, the claim amount is for roughly $14 million USD, but it appears investors are willing to bet on PNTR’s future despite the pending lawsuit which many may feel will have minimal effect, even if PNTR has to pay the full amount.

We added PNTR to our GeoBargain list on June 19, 2017 when shares were trading at $11.98. PNTR provides mobile resource management products and services for the automotive, insurance industries, and other mobile tracking markets worldwide.

Research

Thu, 17 Aug 2017 14:11:19 GMT

GB PNTR ($13.45) - A new 13G filing from Phoenix Holdings disclosed an 18.0% stake.

In related news, HC Wainwright reiterated its “Buy” rating and $18 price target. Yesterday PNTR posted strong Q2 2017 results.

Comments & Business Outlook

Wed, 16 Aug 2017 15:23:59 GMT

GB $PNTR ($12.00; marked up 8%) announced Q2 2017 results:

Sales of $20.0 million vs $16.2 million in the prior year and ahead of analyst estimates of $18.2 million
EPS of $0.24 vs $0.13 in the prior year and ahead of analyst estimates of $0.21

Quotes from management:

“In the past months, we have made great progress on two strategically important deployments. We have successfully completed most of the installations with Femsa, the Coca-Cola bottling company in Mexico, and we have fully deployed our driving behavior solution integrated with Mobileye devices in a 5,000-car fleet in New York City. In addition, we recently announced a new long-term product supply agreement with a leading US-based telematics provider. This contract is the first substantial win for our new Nano CelloTrack technology. We believe this is the first of many other opportunities that we expect to capitalize on in the coming quarters."

Legal Insights

Thu, 03 Aug 2017 14:40:07 GMT

PNTR ($12.30) - Shares of GeoBargain PNTR have pulled back off recent highs of $14.65. Yesterday the Company announced a class action lawsuit has been filed against them alleging it is misleading some of the company customers, claiming that during the last seven years the company is charging them for a superior system while installing an inferior system. The claim amount is estimated to be $14 million USD.

Obviously, we are not happy to see this lawsuit. So far, the Company has not given us enough details on the case. However, we anticipate that this legal issue will probably drag on for a bit before potentially knowing the ultimate cost to the company if they were in the wrong or if they want to settle.

Research

Wed, 26 Jul 2017 14:47:08 GMT

GeoBargain PNTR ($13.75) announced it has signed a long term development and supply agreement with a customer based in North America. Deliveries will start in 2018 and revenues are projected to be roughly $2 to $3 million on an annual basis. While the size of the contract is relatively small, the penetration into the North American market is nice to see as PNTR has little to no revenues in this region. Per the company’s latest 20-F:

Research

Tue, 20 Jun 2017 15:41:05 GMT

PNTR ($12.05) - On June 12, 2017 we stated we had disclosed our long position and coded PNTR a GeoBargain on the radar until an interview with management. Shares were trading near today’s level. Yesterday we issued the following tweet:

Yesterday Siggy and I had a chance to speak with PNTR management where we brought up three caveats unearthed during our due diligence process. Below are our take-aways based on the conversation:

Caveat One - Uncertain regulatory environment as it relates to PNTR business in South Africa.
- Concern alleviated - Africa represents around 10% of revenue and from what we could garner from our interview, South Africa appears to comprise a small amount of this total.
Caveat Two - Lack of visibility for hardware sales ( 35% of revenue)
- Concern exists, but the magnitude of volatility, quarter to quarter, appears to be minimal.
Caveat Three - Active Shelf filed on June 30, 2016 (F-3)
- We feel comfortable that the shelf would only be utilized if the company were to make large acquisitions.

Stay tuned for more PNTR updates.

On a side note, it was interesting that when I brought up $MIXT ($8.28) as competitor (primarily in Africa), management expressed a level of respect for the company. This reminded me of the book “One Up On Wall Street,” when Peter Lynch stated that, during his interviews with management teams, he would ask them what competitors they respected. Then he would take a close look at these comps.

Shares of MIXT hit a new 52 week high of $8.29 during yesterday’s trading session. On May 26, 2017, when the stock was trading $6.92 we stated we were keeping a close eye on this fleet management SaaS company as it may have finally reached an inflection point. You can see our full research notehere. Unfortunately we never pulled the trigger for a position or trade on this run. But we plan to revisit the story more aggressively.

Maj Soueidan, Co-founder GeoInvesting

Research

Mon, 12 Jun 2017 14:42:43 GMT

We are disclosing a long position in PNTR ($11.90) and coding it as a “GeoBargain on the Radar” until we interview management since there are a few caveats we still need to iron out:

South African regulatory environment which could negatively impact sales
Unpredictability and lack of visibility of the hardware business which accounts for 35% of business
Shelf filed on June 30, 2016
The NASDAQ and technology indices were shaky to end the week last week and look to open up lower this week

Unfortunately, our interview with management is not scheduled to happen until the week of June 19th. If all goes well, we think PNTR has the potential to be a home run if investors place a SaaS valuation on the company’s revenue. We also think there is meaningful upside to already nice analyst estimates of $0.80 for fiscal 2017 and $1.02 for fiscal 2018 since we are convinced that PNTR will consummate an acquisition in 2017.

Research

Fri, 19 May 2017 15:37:50 GMT

PNTR ($10.40) - We are keeping a close eye on PNTR as the Company continues to report strong quarterly earnings and continues to expand its SaaS business segment. Yesterday PNTR reported record Q1 2017 results which can be seen here. We are taking a closer look at the Company’s valuation, as we believe solely based on its service segment (SaaS), shares could possibly double if you apply a common Price/Sales multiple of other SaaS companies (EV/S of 2 to 4 equating to 21% to 143% increase). Revenues from the service segment accounted for 67% of total sales in Q1.

In related news, Rodman & Renshaw reiterated a “Buy” rating and $15 price target this morning. As we have stated before, we believe that Rodman & Renshaw played a very big role in the U.S. listed China scandals that popped up in 2010. So we always take caution when a Company is covered by them.