IPOs, Initial Public Offerings: pre & post IPO

AVTC

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AVT, Inc. (AVTC)

Stock symbol: AVTC.QB                                       Common shares: 12/31/11: 10.7mm
Stock price 4/27/12: $1.70                                                                Float 4.8mm(est)
52-week price range: $ 1.00 – $3.50            Equity market capitalization: $18.2mm

Recent News     Stock Price & Chart     SEC Filings
Shareholders’ Meeting Video

RECOGNITION

  • AVTC ranked 117 in world’s fastest growing companies list…read more
  • AAVT Featured on ABC-TV, named the third fastest growing company in California…read more

BUSINESS
AVTC manufactures technology-driven, integrated automated retail stores, easily customized using patent-pending software and hardware.  AVTC is the market leader in the dynamically growing, hot self-service retail space.

  • IPOdesktop believes AVTC is the low cost, high tech leader in the industry, and has created very high barriers to entry for its competition.
  • AVTC is the only pure play public stock in the industry.

RAPID INTERNAL, ORGANIC GROWTH
AVTC generated internal, organic top line revenue growth from $2.2 million in 2007 to $10.3 million in 2011, during times of severe economic stress and uncertainty.

During this period of rapid expansion and major R&D expenditures, AVTC remained profitable, and generated $1.3 million profits for the calendar year ended December 2011.

HIGHLIGHTS & VALUATION

  • IPOdesktop believes AVTC is an ‘undiscovered’ pink sheet company soon to become a small cap NASDAQ company
  • Then, AVTC will be compared to other emerging companies with similar growth rates.  In this economic climate it is difficult to find emerging companies with similar growth rates.

VALUATION
IPOdesktop believes AVTC is undervalued based on the following:

Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

annualizing Dec ’11 qtr

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

AVT (AVTC)

$19

1.2

4.4

1.0

2.1

Fully diluted

$46

2.9

10.9

2.4

5.2

Also see FINANCIALS at the end of this report.

COMPARE
Based on our particular area of expertise – IPOs – we compare AVTC results with the best performing IPOs year-to-date, which are also in fast-growing markets.

 

Compare with the 5 best performing IPOs YTD
annualizing Dec ’11 qtr
Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

annualizing Dec ’11 qtr

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

AVT (AVTC)

$19

1.2

4.4

1.0

2.1

Fully diluted

$46

2.9

10.9

2.4

5.2

GWRE

$1,490

7.2

74.5

11.5

11.0

BNNY

$699

5.6

79.4

12.2

27.0

PRLB

$705

6.8

55.1

6.5

6.5

YELP

$1,500

15.1

-121.0

11.8

11.8

BV

$1,150

9.9

-43.6

14.2

14.5

all are also in high growth markets
GWRE: Guidewire Software +119% from IPO price
BNNY: Annie’s +116% from IPO price
PRLB: Proto Labs +91% from IPO price
YELP: Yelp! +70% from IPO price
BV: Bazaarvoice +69% from IPO price

AUTOMATED, SELF SERVICE MARKET EXPLODING
According to NCR’s CEO, Bill Luria…

  • About 20 percent of the check-out lanes at grocery and general merchandise stores are self-service now, up from almost zero a decade ago
  • Self service tends to be much more software intensive
  • Retailers are looking at their capital budgets again and they see self-service as a way to increase efficiency and improve service

According to an industry market researcher…

  • In terms of growth, self–service kiosks are projected to experience the maximum growth in installations with a compound annual growth rate (CAGR) of 9.3%. This sector was estimated at 1.6 million units in 2010 and is expected to reach 2.5 million units in 2015.
  • Vending machines represent the largest segment in this market, accounting for more than 85% of all deployments to date. This sector was estimated at 24.4 million units in 2010 and is expected to increase at a 3.2% compound annual growth rate (CAGR) to reach 28.6 million units in 2015.
  • The total installed combined base for self–service technologies including ATMs, self–service kiosks and vending machines is estimated at 28.2 million units in 2010 and is expected to reach 33.8 million units by 2015, growing at a compound annual growth rate (CAGR) of 3.7% from 2010 through 2015.  Source

Automation threatens job growth in retail sector…read more

AVTC IS CONVERTING TO FULL PRODUCTION ORDERS
Examples
(1) Rug Doctor® Partners With AVT for Self Service Kiosk System. With over 35,000 rental locations worldwide, Rug Doctor is the market leader in home carpet cleaning rentals, and can be found in grocery, drug, hardware, and home center stores across the United States

(2) AVTC strategic partner/customer H.U.M.A.N. has sold over 600 of AVTC’s hi-tech healthy automated retail systems to-date.  Projections are to at least double that number over the next 12-months.  These state-of-the-art units feature touch screen LCDs, streaming video content, cashless payment systems, eco-friendly power devices, and attractive graphics…read more

(3) Marley Coffee and AVTC to create high-end Marley Coffee branded automated coffee vending and merchandising machines for retail locations around the world…read more

AVTC’S BLUE CHIP ACCOUNTS
AVTC’s impressive sales growth is fueled by 20-30 successful pilot and production programs with blue ship retailers including Costco, Walmart, Sam’s Club, Blue Rhino, Rug Doctor, Quiksilver plus Prescription Vending Machines, Pop & Go, H.U.M.A.N., Flix on Stix and many others.

INTELLECTUAL PROPERTY
. Powered by intellectual property based on five pending patents
. Enhances AVTC’s ability to deliver high tech services, such as acceptance of credit and debit cards for cashless payment, dynamic advertising, remote tracking, and inventory management.

COMPETITION
AVTC is the only publicly traded pure play we can find to participate in the growth of the high technology self service retail space.  Major competitors include

  • Crane:  Owns Dixie Narco, AP (Auto Products) and National Vendors & is the largest manufacturer of traditional baseline vending systems.
  • USI: Seasoned vending manufacturer with many years experience manufacturing of traditional baseline vending systems.
  • AMS: Designs its own traditional baseline systems and has been in the vending business for many years.
  • Zoom Systems: Designs vending systems which integrate high levels of technology.    Because Zoom Systems integrates high levels of technology into its systems, it would be considered one of AVT’s primary competitors.

COMPETITIVE ADVANTAGES
AVTC is a low price, high quality leader offering technology solutions at 50% less than the best known competitor.  For example,

  • AVTC employs a unique robotic arm that dispenses up to 150 items of all types, from cell phones to swimsuits, cameras to cologne.
  • AVTC employs patent pending state-of-the-art computer technology running new, highly advanced software programs and patent pending technologies that process a customer’s credit card in a matter of seconds, while also sending alerts to the machine’s owner — providing instantaneous real-time sales reports and inventory notifications.
  • Units can be configured to feature cash and/or cashless payment systems, enhanced security, on-board refrigeration and heating, custom graphics, instant online inventory status, and system health reports.

Web Site      Blog

Address: 341 Bonnie Circle, Suite 102, Corona, CA 92880
Telephone: (951) 737-1057
CEO: James Winsor
State of Incorporation: Nevada
Transfer Agent: Action Stock Transfer, Salt Lake City, Utah
Investor Contact: Andrew J. Barwicki, 516-662-9461

FINANCIALS

AVT (AVTC)

Shares: 10.7mm

Automated retailing

Shares fully diluted: 26.4 million

Corona, CA

2007

2008

2009

2010

2011

IPO Mkt

Revenues ($mm)

$2,218,991

$2,956,645

$4,431,154

$5,658,142

$10,300,395

Cap (mm)

Gross profit % of revenue

77%

68%

62%

70%

60%

$19

Profit (loss)

$104,012

$35,728

$117,068

$22,191

$1,364,023

Profit (loss) margin

5%

1%

3%

0%

13%

EBITDA

$252,681

$40,214

$519,084

$1,350,906

$2,773,468

EBITDA % of rev

11%

1%

12%

24%

27%

Quarterly results

Sept, ’10

Dec, ’10

March, ’11

June ’11

Sept ’11

Dec ’12

Revenues ($mm)

$1,798,252

$1,886,425

$1,404,198

$2,667,926

$2,197,399

$4,030,872

Revenue increase over prior qtr

5%

-26%

90%

-18%

83%

Gross profit %

62%

82%

77%

47%

67%

60%

Profit (loss)

$189,794

$539,621

$9,916

$34,800

$257,579

$1,061,728

Profit (loss) margin

11%

29%

1%

1%

12%

26%

Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

annualizing Dec ’11 qtr

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

AVT (AVTC)

$19

1.2

4.4

1.0

2.1

Fully diluted

$46

2.9

10.9

2.4

5.2

Compare with the 5 best performing IPOs YTD
annualizing Dec ’11 qtr
Valuation Ratios

Mrkt

Price /

Price /

Price /

Price /

annualizing Dec ’11 qtr

Cap (mm)

Sales

Earnings

BookValue

TangibleBV

AVT (AVTC)

$19

1.2

4.4

1.0

2.1

Fully diluted

$46

2.9

10.9

2.4

5.2

GWRE

$1,490

7.2

74.5

11.5

11.0

BNNY

$699

5.6

79.4

12.2

27.0

PRLB

$705

6.8

55.1

6.5

6.5

YELP

$1,500

15.1

-121.0

11.8

11.8

BV

$1,150

9.9

-43.6

14.2

14.5

all are also in high growth markets
GWRE: Guidewire Software +119% from IPO price
BNNY: Annie’s +116% from IPO price
PRLB: Proto Labs +91% from IPO price
YELP: Yelp! +70% from IPO price
BV: Bazaarvoice +69% from IPO price

IPOdesktop (ID) SAFE HARBOR STATEMENT: Statements contained in this document, including those pertaining to estimates and related plans, potential mergers and acquisitions, estimates, growth, establishing new markets, expansion into new markets and related plans other than statements of historical fact, are forward-looking statements subject to a number of uncertainties that could cause actual results to differ materially from statements made. ID provides no assurance as to the subject company’s plans or ability to effect any planned and/or proposed actions. ID has no first-hand knowledge of management and therefore cannot comment on its capabilities, intent, resources, nor experience and makes no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company or its agent and related sources believed by ID to be reliable, but ID provides no assurance, and none is given, as to the accuracy and completeness of this information.
DISCLAIMER: The information, opinions and analysis contained herein are based on sources believed to be reliable but no representation, expressed or implied, is made as to its accuracy, completeness or correctness. Past performance is no guarantee of future results. This report is a paid advertisement and is for information purposes only and should not be used as the basis for any investment decision. ID has been compensated up to eight thousand five hundred dollars from a third party or the company for preparation and posting of this report, audio interview, virtual road show and other advertising services. This constitutes a conflict of interest as to ID’s ability to remain objective in its communication regarding the subject company. Analysts, principals, associates and employees of ID do not own or trade equities under coverage. For detailed disclosure as required by Rule 17b of the Securities Act of 1933/1934 contact IPOdesktop, 12228 Venice Blvd., #374, Los Angeles, CA 90066. ID is not an investment advisor and this report is not investment advice. This information is neither a solicitation to buy nor an offer to sell securities but is a paid advertisement. Information contained herein contains forward-looking statements and is subject to significant risks and uncertainties, which will affect the results. The opinions contained herein reflect our current judgment and are subject to change without notice. We encourage our readers to invest carefully and read the investor information available at the web sites of the U.S. Securities and Exchange Commission (SEC) at http://www.sec.gov and the National Association of Securities Dealers (NASD) at http://www.nasd.com. The NASD has published information on how to invest carefully at its web site. Readers can review all public filings by companies at the SEC’s EDGAR page.

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