Q: Please provide an update on GPV. Do you like this one as a small speculative position?
5i Research Answer:
GPV recently missed earnings and sales estimates, and the stock has seen a roughly 25% decline since earnings last week. It is a small name ($72M market cap), has seen sales growth over the past several years, but it is not profitable, does not generate positive free cash flow, and has been issuing shares to fund its operations. Its balance sheet has been shrinking over the past few years, and shares have been flat over the past eight years. Overall, we do not like its negative momentum, and we would prefer waiting until its profit margins improve and it consistently beats earnings and sales estimates.