A cheap tech duopoly posts +259% growth: Seeing Machines CEO call
Speaking with Paul McGlone about the future of Seeing Machines.
The inflection is finally here. Q3 KPIs have been incredible, surpassing my estimates. The GSR ramp-up is no longer theoretical, YoY royalty growth came in at 259%, and the path to 2m+ units per quarter now seems almost inevitable.
We’re set to turn cash-flow positive, ready to refinance the loan, and positioned to pursue further growth opportunities.
Aftermarket continues lagging, mainly due to delays not cancellations, and we’ve seen a new contract yesterday and it seems like the pipeline is strong going into the next quarters.
The valuation looks attractive even if we assume minimal contribution from Guardian 3. Under those assumptions, it’s trading around 10x FCF; if you include the aftermarket division, it drops to a single-digit multiple.
That’s cheap for a monopolistic business with substantial growth ahead. If you’re new to the story, I’d recommend reading the last deep dive I posted.
To understand even better the business case, today we have with us Paul McGlone, CEO of Seeing Machines:
Now it’s time to revisit the thesis and run the numbers. We’ll do a valuation sensitivity analysis under different assumptions for automotive and aftermarket revenues, and we’ll review the key catalysts in the stock, without forgetting the risks.
We’ll also add a short note at the end, as we’ve seen some signals that a Japanese OEM contract could be near.
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