In a December 9 research note, eResearch Corp.'s Director of Equity Research Chris Thompson CFA, MBA, P.Eng., commented that as consumer concerns drive governments to enact stricter consumer privacy laws and place restrictions on the use of online tracking via "cookies," Canadian software development and technology company Datable Technology Corp.'s (DAC:TSX.V; TTMZF:OTCQB) solutions are well positioned to focus on and profit from first-party data collection.
The report indicated that Datable's revenue is expected to grow by 70% next year and 50% over the following four years.
First-party data is essentially data collected from users who choose to "opt-in" to a provider's trusted application or website. The report from eResearch suggested that as the use of cookies gets phased out first-party data solutions will be the key factor in building engagement with online consumers. Specifically, the data is obtained directly from consumers when they elect to opt-in to promotions or to participate in various loyalty or reward programs.
According to eResearch, "Datable's platform delivers first-party data collection, analytics, and monetization via a software as a service (SaaS) technology, allowing brands to engage consumers and build relationships."
The company is focused primarily on the consumer online advertising and marketing sectors and has developed a consumer lifecycle and data management platform which it calls PLATFORM³. Datable Technology's SaaS platform offers the tools for consumer brands and consumer packaged goods (CPG) firms to create, launch and manage promotions, unique offers and loyalty programs accessible by mobile phones, websites and microsites.
The firm then focuses its efforts on collecting and parsing through this extremely valuable first-party customer mined data which allows its clients to further build upon and directly expand its relationship and communication with consumers.
The analyst noted that Datable is heading into an accelerated growth phase after achieving a 91% year-over-year increase in Q3/21 revenues. The report indicated that Datable's revenue is expected to grow by 70% next year and 50% over the following four years. The firm's transformative Dabbl acquisition will serve to create a company that is projected to attain nearly CA$6 million in pro-forma FY/21 revenue.
Notably, Datable presently provides services to a strong base of Fortune 500 customers which includes 25 large CPG companies and 50 of the world's most well-known consumer brands including Henkel, Kimberly Clark, and Proctor & Gamble.
eResearch mentioned that Datable is presently trading at 1.0x its 2022 (combined companies) revenue estimate of CA$9.9 million, which is far below other Canadian SaaS comparable companies. The report stated that the company's low revenue multiple versus SaaS peers offers potential price appreciation for Datable shareholders.
The analyst estimates the firm will generate CA$3.0 million in revenues during FY/21 rising to CA$9.9 million in FY/22.
eResearch Corp. advised that it is initiating coverage on Datable Technology Corp. with a "Speculative Buy" rating and a target price of CA$0.30 per share. The firm's shares trade on the TSX Venture Exchange under the symbol "DAC" and last closed for trading at CA$0.65 per share on Friday, December 10, 2021. The company's shares additionally trade under the ticker symbol "TTMZF" on the OTCQB Venture Market.
Disclosure:
1) Stephen Hytha compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
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Important Disclaimers for eResearch, Datable Technology Corp., Dec. 9, 2021
eResearch was established in 2000 as Canada's first equity issuer-sponsored research organization. As a primary source for professional investment research, our Subscribers benefit by having written research on a variety of small- and mid-cap, under-covered companies. We also provide unsponsored research reports on middle and larger- sized companies, using a combination of fundamental and technical analysis. We provide our professional investment research and analysis directly to our extensive subscriber network of discerning investors, and electronically through our website: www.eresearch.com. NOTE: eResearch company reports are available FREE on our website: www.eresearch.com.
eResearch Intellectual Property: No representations, express or implied, are made by eResearch as to the accuracy, completeness or correctness of the comments made in this report. This report is not an offer to sell or a solicitation to buy any security of the Company. Neither eResearch nor any person employed by eResearch accepts any liability whatsoever for any direct or indirect loss resulting from any use of its report or the information it contains. This report may not be reproduced, distributed, or published without the express permission of eResearch.
ANALYST ACCREDITATION. eResearch Analyst on this Report: Chris Thompson CFA, MBA, P.Eng. I, Chris Thompson, hereby state that, at the time of issuance of this research report, I do not own common shares, share options or share warrants of Datable Technology Corporation (TSXV:DAC).
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eResearch does not manage money or trade with the general public, provides full disclosure of all fee arrangements, and adheres to the strict application of its Best Practices Guidelines. eResearch accepts fees from the companies it researches (the “Covered Companies”), and from financial institutions or other third parties. The purpose of this policy is to defray the cost of researching small and medium capitalization stocks which otherwise receive little or no research coverage.
Datable Technology Corporation paid eResearch a fee to have it conduct research and publish reports on the Company for one year.
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