SMSI - Embedded Expectations Analysis - 2021 03 01
Smith Micro Software, Inc. (SMSI:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 51.9x Uniform P/E. At these levels, the market is pricing in bullish expectations for the firm, but management may be concerned about SafePath 7's potential, operating and R&D costs, and their relationship with DISHSpecifically, management may lack confidence in their ability to maintain strong cash flow from operations, maintain CommSuite sequential revenue growth, and capitalize on SafePath sales opportunities. In addition, they may be exaggerating the potential of their SafePath 7 platform, their leading family application safety positioning, and wireless carrier interest in SafePath. Moreover, management may lack confidence in their ability to mitigate increases in operating and R&D costs and transition Safe & Sound customers to SafePath 7. Finally, management may be overstating their focus on pursing new opportunities for the SafePath platform, the success of ViewSpot promotions, and the potential of their partnership with Dish
Smith Micro Software develops software and provides solutions to wireless service providers and cable multiple service operators. The company's portfolio also includes a range of products for creating, sharing and monetizing content, such as visual messaging, optimizing retail content display, analytics capabilities, and 2D/3D graphics applications. The company's business is focused on two industry segments: Wireless, which includes its NetWise?, CommSuite?, and SafePath? family of products; and Graphics, which includes its consumer-based products: Poser?, Moho?, MotionArtist?, Rebelle, PhotoDonut and StuffIt?.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
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- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
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