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Route1 Inc (TSE:ROI)
:ROI
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Route1 Inc
(ROI)
53Neutral
Route1 Inc (ROI) vs. S&P 500 (SPY)
Market Cap
C$1.70M
Dividend YieldN/A
Average Volume (3M)14.00K
Price to Earnings (P/E)―
Beta (1Y)0.14
Revenue Growth-6.90%
EPS Growth61.86%
CountryCA
Employees30
SectorTechnology
Sector Strength44
IndustrySoftware - Application
Share Statistics
EPS (TTM)-0.02
Shares Outstanding42,497,154
10 Day Avg. Volume21,833
30 Day Avg. Volume14,002
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.14
Price to Cash Flow (P/CF)0.30
P/FCF Ratio0.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Route1 Inc Business Overview & Revenue Model
Company DescriptionRoute1 Inc. (ROI) is a technology company specializing in secure data management and mobility solutions. The company operates within the cybersecurity and information technology sectors, providing services that enable secure remote access and data protection for government and enterprise clients. Their core products include secure data management platforms and identity management solutions designed to meet the stringent security requirements of their clientele.
How the Company Makes MoneyRoute1 Inc. generates revenue through the sale of its secure data management and identity management solutions. The company offers software licenses, subscriptions, and consulting services to government agencies and enterprises, which make up its key revenue streams. Additionally, Route1 Inc. may engage in strategic partnerships with other technology firms to enhance its service offerings and expand its market reach, further contributing to its earnings.
Route1 Inc Financial Statement Overview
Summary
Route1 Inc. faces significant financial challenges with declining revenue, negative profit margins, and high leverage. While there are improvements in operating cash flow, the overall financial health is concerning due to negative equity and inconsistent free cash flow. Strategic realignment may be necessary to address these issues and stabilize financial performance.Income Statement
The company has experienced declining revenues from $29.7M in 2020 to $15.5M in TTM 2024, indicating significant revenue contraction. The net profit margin is negative, with a net loss of $1.04M in TTM 2024, reflecting ongoing profitability challenges. The EBIT and EBITDA margins are also negative or low, highlighting operational inefficiencies. However, there's a slight improvement in EBITDA margin from previous periods.45
Neutral
Balance Sheet
The company's balance sheet shows high leverage with a negative equity of $-211K in TTM 2024, indicating financial instability. The debt-to-equity ratio is unfavorable due to negative equity, increasing financial risk. The equity ratio has deteriorated over the years, showing a concerning trend in asset financing through debt.30
Negative
Cash Flow
Operating cash flow has improved to $984K in TTM 2024, but free cash flow remains volatile despite a recent increase. The operating cash flow to net income ratio is strong due to the net loss, but free cash flow growth is inconsistent. The company faces challenges in maintaining stable cash flow amidst declining revenues.50
Neutral
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 15.52M | 17.58M | 22.05M | 27.27M | 29.71M | 24.01M | Gross Profit |
| 4.83M | 5.87M | 7.58M | 10.82M | 11.07M | 9.03M | EBIT |
| -1.85M | -637.52K | -376.90K | 593.39K | -16.78K | 232.91K | EBITDA |
| 466.15K | 542.08K | 1.02M | 1.80M | -224.72K | -14.23K | Net Income Common Stockholders |
| -1.04M | -1.28M | -1.72M | 222.21K | -1.71M | -554.18K |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.34M | 38.35K | 78.50K | 62.57K | 1.14M | 125.54K | Total Assets |
| 3.48M | 9.54M | 12.36M | 15.10M | 14.18M | 12.63M | Total Debt |
| 834.72K | 4.62M | 4.99M | 4.72M | 4.09M | 3.06M | Net Debt |
| -500.91K | 4.58M | 4.91M | 4.66M | 2.95M | 2.94M | Total Liabilities |
| 3.39M | 8.96M | 10.59M | 12.37M | 12.04M | 11.65M | Stockholders Equity |
| 86.21K | 584.35K | 1.77M | 2.73M | 2.14M | 979.73K |
| Cash Flow | Free Cash Flow | ||||
| 894.64K | 218.88K | 580.32K | 353.39K | -226.36K | -371.26K | Operating Cash Flow |
| 984.62K | 686.82K | 602.27K | 1.05M | 256.27K | 328.23K | Investing Cash Flow |
| -88.22K | -467.94K | 530.00 | -2.20M | -458.06K | -1.80M | Financing Cash Flow |
| -1.07M | -347.76K | -457.59K | 5.50K | 1.32M | 621.95K |
Route1 Inc Technical Analysis
Negative
0.04
Price Trends
0.05
Negative
0.04
Negative
0.03
Positive
Market Momentum
>-0.01
Positive
41.09
Neutral
13.33
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ROI, the sentiment is Negative. The current price of 0.04 is below the 20-day moving average (MA) of 0.05, below the 50-day MA of 0.05, and above the 200-day MA of 0.03, indicating a neutral trend. The MACD of >-0.01 indicates Positive momentum. The RSI at 41.09 is Neutral, neither overbought nor oversold. The STOCH value of 13.33 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ROI.
Route1 Inc Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | C$69.92M | 23.93 | 10.46% | ― | -0.81% | ― | |
68 Neutral | C$190.63M | ― | -1.93% | 0.49% | -13.99% | -421.95% | |
65 Neutral | C$545.74M | ― | -14.10% | ― | 31.68% | 67.90% | |
61 Neutral | C$9.87M | 26.80 | 4.63% | ― | -2.75% | -89.95% | |
58 Neutral | $21.03B | 10.58 | -16.29% | 2.47% | 4.38% | -23.63% | |
53 Neutral | C$1.70M | ― | -333.58% | ― | -6.90% | 61.86% |
* Technology Sector Average
Performance Comparison
TSE:ROI
Route1 Inc
0.04
-0.02
-33.33%
TSE:IQ
Airiq Inc
0.34
-0.10
-22.73%
TSE:SYZ
Sylogist
8.15
-0.53
-6.11%
TSE:QIS
Quorum Information Technologies
0.95
0.22
30.14%
TSE:BLN
Blackline Safety
6.45
2.23
52.84%
Route1 Inc Earnings Call Summary
Earnings Call Date: Nov 26, 2024 | % Change Since: 100.00% | Next Earnings Date: Apr 24, 2025
Earnings Call Sentiment Neutral
Route1 has made significant progress in stabilizing its business model and growing its non-MobiKEY revenue streams. The company is optimistic about future EBITDA growth and financial stability. However, challenges remain, particularly with the decline in MobiKEY revenue and the impact of decreased VAR business. The sentiment is cautiously optimistic as Route1 continues to navigate its pivot to services.Highlights
Pivot to Services and Stabilization
Route1 has successfully pivoted from a pure play software cybersecurity company to an outcome-based services company, focusing on video capture-based technologies. The company reports stabilization in the fourth quarter of 2023, with a promising outlook for 2024.
Growth in Non-MobiKEY Business
The non-MobiKEY gross profit generation exceeded $150,000 in two of the last four quarters, indicating growth in professional services and support contracts.
Support Contracts Revenue Milestone
In Q1 2024, Route1 achieved more than $1 million in annualized revenue from support contracts, reflecting significant growth in the recurring revenue stream.
Improved Financial Metrics
Route1 anticipates exceeding $1 million in trailing four-quarter EBITDA by mid-2024, aiming for improved working capital and reduced third-party debt levels.
Lowlights
Decline in MobiKEY Revenue
There was a loss of approximately $225,000 in quarterly subscriber revenue from MobiKEY, attributed to competition from Microsoft integrating similar services in their suite.
Impact of Decline in VAR Business
Revenue was negatively impacted by a $4.5 million decrease due to a reduction in value-added reseller business and MobiKEY subscriber base.
Debt and Working Capital Challenges
Despite stabilization efforts, Route1 continues to manage high debt levels and working capital challenges, with a focus on reducing these through 2024.
Company Guidance
During the Q4 2023 earnings call for Route1, CEO Tony Busseri discussed the company's strategic pivot from a pure play software cybersecurity firm to a comprehensive services provider, emphasizing their focus on delivering video capture-based technologies. He highlighted several key metrics, noting a decrease in revenue by approximately $4.5 million due to a reduction in value-added reseller business and MobiKEY subscriptions, which affected gross margins by around $700,000. Despite this, the company saw stability and growth in other areas, achieving non-MobiKEY gross profit above $150,000 per quarter in two of the last four quarters. Additionally, Route1's recurring license plate recognition technology support agreements exceeded $1 million on an annualized basis by Q1 2024. Busseri also underscored the importance of fixed cost control to enhance EBITDA and expressed optimism about achieving over $1 million in trailing four-quarter EBITDA by the end of the first half of 2024, while maintaining a stable debt position and improving working capital.Route1 Inc Corporate Events
Route1 Inc. Confirms Meeting Approvals and Leadership
Nov 20, 2024
Route1 Inc. announced that all proposals at their annual meeting, including director re-elections and auditor appointments, were approved, reinforcing their leadership and financial oversight. The company, known for its data-centric business solutions, will release its third-quarter financial results on November 26, 2024.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.