As Food Service and Other Companies Climb Toward Fuller Capacity, ShiftPixy (PIXY) provides staffing solutions for a wide array of businesses. You do not have to look far to see that many businesses are having issues staffing their facilities.
Good day everyone,
Initiating coverage on ShiftPixy, Inc. (NASDAQ: PIXY), a company providing a human capital management platform, revolutionizing employment in the Gig Economy by delivering a next-gen mobile engagement technology to help businesses with shift-based employees.
Current price $1.82 per share
We reported on PIXY a year ago and want to bring it to you again because the company’s value has dipped to irresistible levels, and it appears revenue growth may be on the horizon. With only 8.7M shares in the public float, a swing in the company revenue/value could happen quickly.
When we look at the company stock chart, we see a 2021 history of dips followed by a significant swing and the shares are in a dip right now. PIXY shares have consolidated to a level below their 50 DMA and 200 DMA of $2.29 and $2.59 respectively. The current RSI (14) is 41.32.
PIXY shares experienced significant gains this year after dips in their value. In March that gain was 67%, in May that gain was 95%, and in June the gain was 70%. The current dip in the company value is somewhat deeper and longer than the previous three this year creating the potential for a bigger swing to the upside.
PIXY specializes in providing temporary staffing in the food industry. To say 2020 was a challenging year for the company would be an understatement. Revenues plummeted as most of their restaurant clients were shut down due to the pandemic. Thus far in 2021, food service client establishments have only been open for business on an intermittent basis.
On Wednesday of last week, PIXY CEO Scott Absher did a video interview, and we recommend you view it as a part of your due diligence. Mr. Absher discusses the Gig economy, the PIXY model and app, ghost kitchens and the impact of covid.
The PIXY process is accomplished through the ShiftPixy platform where employers and workers are connected through a mobile app. Employers post their shift needs and workers post their availability.
As of February 28, 2021, the company had 84 clients with over 3,000 WSEs (workers) and processed annualized payroll of over $72 million during fiscal period ending on February 28, 2021. According to the 2018 and 2019 MBO Partners State of Independence in America Reports, 24% of independent workers used an online platform to find work and 52% of the U.S. workforce will be independent by 2023.
In late June, Florida based ShiftPixy hosted the first in a series of recruiting events called MIAMI WORKS to help shift workers find job opportunities that offer living wages, a sign-up bonus, and flexible schedules, as well as healthcare, workers’ compensation, and 401K benefits. We want to note that PIXY also offers food service, and food delivery companies, experienced delivery drivers. ShiftPixy’s delivery platform is called ZiPixy and allows multi-unit food service operators to assure a brand-intended customer experience for mobile orders while keeping 100% of their sales.
PIXY has a FYE of August 31st, so they are currently in their Q4 2021. The timing of the PIXY FYE and the pandemic has had a chilling impact on the company revenues for two consecutive fiscal years. That’s the bad news, the good news is a new fiscal year begins September 1st. Revenues for the trailing twelve months were $9.93M and we think FYE 2021 revenues may be significantly higher.
We’re all aware that staffing for restaurants is a challenge now and PIXY may be able to thrive in that situation by helping keep food service staffed. We note that Q3 2021 revenues were 9.4% higher than Q2 2021 indicating that revenue momentum may be growing.
As there may be a swing in PIXYs value in the near term, we want to point out the company’s modest share structure, (outstanding shares (est.) 25.8M, float (est.) 8.7M) is important as these low numbers may facilitate a rapid movement in the PIXY share price.
Insiders hold 51% of PIXY shares indicating strength in the management’s view of the future for the company. And they are holding on to that equity as there have been no insider trades in 2021 thus far.
It looks as though everything is lined up for a near term gain in ShifyPixy’s value. The food service sector gaining momentum, the chart set-up, a new level of food delivery all could combine to impact PIXY’s value.
Stay tuned for more on PIXY,
The Traders News Group
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