Updated coverage 8/17/21 8AM Eastern – Infobird (IFBD) is a Growth Oriented SaaS Provider Expanding into New Markets and Enhancing Product Offerings with Artificial Intelligence
Good day everyone,
We are continuing coverage on Infobird Co., Ltd (NASDAQ: IFBD), a software-as-a-service provider of AI-powered or enabled customer engagement solutions in Beijing.
Current price $3.24/share (at market close 8-16-21)
IFBD shares closed the Monday session at $3.28 (+8%) after opening at a gapped $3.15 per share. The trading range was $3.02 to $3.34/share. Price support was strongest in afternoon trading.
Like Cloopen Group Holding (NYSE: RAAS), Zendesk (NYSE: ZEN) and Twilio (NYSE: TWLO) Infobird offers AI-driven telemarketing, omni-channel customer support, intelligent voice/text chatbots and more. But there is a big difference amongst the three companies:
Cloopen – Market value $757M (a PRC company)
Infobird – Market value $75M (a PRC company)
Zendesk – Market value $14B (a USA company)
Twilio – Market value $60B (a USA company)
The three competitors above have an average price to sales ratio of 15.70X. When we apply that same ratio to IFBD based upon 2020 revenues, we come up with a market value of $227M. If we apply that ratio to the company guidance for 2021 revenues of $21.75M, we come up with a market value of $341M.
Those three competitors listed above have one thing in common. None of them generate net profits. IFBD, the up and comer in the sector had a $4M net profit on $14.5M in revenues for FYE 2020. By any of the metrics we apply, IFBD seems to be an oversold value.
Infobird has 70 Intellectual Property (“IP”) rights developed under its cloud-native architecture and AI technologies.
Expanded description of the IFBD product offerings:
AI Customer Engagement
Intelligent Omni-Channel Customer Service – This offering allows clients to connect with their customers anytime and anywhere through a comprehensive suite of cloud-based tools.
Cloud Call Center – This service puts Infobird’s years of technical and operational experience to work for clients, with options including intelligent IVR technology, call monitoring, routing strategy and ticketing systems, all supported by multi-dimensional data reports.
Intelligent Telemarketing – Infobird’s AI bots can help clients navigate “never-ending lists” of potential customers, filter out the most promising leads and increase the working efficiency of agents, keeping agents focused on high-value tasks.
AI Voice Chatbot and AI Text Chatbot – This technology allows clients to create human-like interactions offering 24/7 availability and multi-round dialogue capabilities, decreasing labor costs by up to 80% while greatly improving efficiency.
WeChat Call Center – designed to help companies further develop the value of existing customers through automated and personalized solutions for private domain traffic. (NEW)
AI Salesforce Management
Intelligent Quality Inspection – Infobird’s platform aims to improve quality inspection rates and service levels using real-time smart monitoring with comprehensive coverage.
Intelligent Training – Interactive training programs allow clients to ensure and continuously improve the performance level of their agents, lessening the impact of high turnover rates common throughout the customer service industry.
Profitable with operational cash flow
High growth sector
Huge insider ownership
Shares appear oversold
As IFBD continues to integrate AI into its product offerings, we expect revenues to experience rapid growth and correspondingly increase its market value.
Original report below
Good day everyone,
Price action looks good so far as of 12:20 PM EST. Watching for a break of the 50 DMA at $3.55/share this week.
We are initiating coverage on Infobird Co., Ltd, a software-as-a-service provider of AI-powered or enabled customer engagement solutions.
Current price $3.00/share
When we researched Infobird (NASDAQ: IFBD), our impression was growth, growth, growth. In fact, the company announced last month that it expects FYE 2021 revenues to grow by 50% over last year. IFBD made that statement with H1 under their belt so we must assume business is going well.
For FYE 12-31-20, IFBD posted revenues of $14.5M and net income of $4.0M. Both figures represent a pandemic influenced drop of 20% from FYE 2019 figures. If we accept the company information about a 50% increase in 2021 revenue, we could estimate a pro forma net income of $6M for 2021.
IFBD completed their IPO on April 20, 2021, raising $25M selling 6,250,000 shares and began trading on the NASDAQ that same day.
We read an article about IFBD published back in June with the headline “Infobird Is a Rare, Undervalued and Profitable SaaS Gem” and we agree with that statement. It appears IFBD may still be under the radar of many investors due to its very recent IPO and could be trading at significantly higher levels. The growing Chinese SaaS market may facilitate rapid growth for the company.
A look at the company stock chart indicates a significant drop from the IPO high (that happens often). Except for a brief spike in late June to $6.10/share, IFBD shares have drifted to today’s value price. The shares are currently trading below their 50 DMA of $3.55 and the current RSI (14) is at 44.19. IFBD is a profitable company projecting a 50% revenue increase this year and indications are the shares may have been oversold.
IFBD has a modest share structure:
Outstanding shares (est.) 25.2M
Shares in float (est.) 10.9M
The tiny float can cause the company share price to swing rapidly. We note that insiders own 51% of the outstanding shares.
The company has been conducting business for a decade and has served over 70,000 clients so they are not a new business by any means. IFBD made its mark in the Chinese economy providing SaaS services to banks and the fintech industry. This year they have branched out to include the fast-growing Chinese retail sector.
Recent deals with SaSa Cosmetics, a company with more than 300 physical retail stores and counters in Asia, and Zu Li Jian, the leading shoe company for the elderly in China, are spearheading the IFBD leap into the retail sector.
A review of the company website indicates that IFBD operates with six different product offerings:
Cloud call center
Intelligent Omni-Channel Customer Service
AI Voice/Text Chatbox
Intelligent Quality Inspection
The company has dozens of clients and we’ve listed some of the key ones below:
China Guangfa Bank – Bank with 44 affiliated branches
ZhongAn Insurance – China’s first internet insurance company
Central South University – 55,000 students
Sinoeyes – DDI data collection
Chaoyang Real Estate Affairs Registration Center – state owned land use rights
Beijing Municipal Postal Administration – postal regulatory agency
HSTYLE – young women’s fashion
Hujaing Online Class – community learning provider
The SaaS market in the PRC is expected to be $6.9B by next year and the global SaaS market is expected to reach $436.9 billion in 2025 at a CAGR of 12.5% so there is ample opportunity for growth at IFBD.
The company released its SEC form 20-F for FYE 12-31-20 on May 14th of 2021 and should be reviewed as a part of your due diligence.
Profitable with operational cash flow
High growth sector
Huge insider ownership
Shares appear oversold and starting to bounce
We believe the aspects above could lead to a near term gain in the company’s value.
Stay tuned and stay informed.
The Traders News Group
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