Yahoo Finance
Filing
July 24, 2018
Q3 2018 Data, Year end: Aug. 31th
Price: $0.36, Shares: 296m, Cap: $107m
1.Basic Information
(1) History
John Levy, son of Cecil who owned a cable company at Hamilton in 1990, found the sports media company which operates the Score sports TV channel. Later it was sold to Rogers for $167m at 2012. In the deal, it excluded theScore mobile App which later became the major product of theScore Inc. John Levy continues to build the new company and it was IPOed at that same year. It was able to grow the revenue to over $25m by 2017.
(2) Business-related.
Products:
1. TheScore App: This is the major sports app it offers. It generates most of the Ad revenue. Currently, it has around 4m active monthly users. The company creates its own media content for the app. Also, it allows the users to set their own preference so the content is more relevant to the user.
2. eSports: Computer gaming sports.
3. Online Sports Betting: Not quite sure whether it is legal to do so in the U.S.A. But the company seems very interested to get into this business.
It seems the first quarter(Nov. 30th) is its strongest quarter. While last quarter(Aug. 31th) is its lowest quarter. The other two quarters are close to the average number of this two quarters.
(3) Management.
John Levy: John successfully found the TV company and sold it to Rogers. He is very open-minded and always looking for changes. Previously when he sold the TV channel to Rogers. He intentionally excludes the mobile app from the deal. It is very impressive that how fast the company grows Ad revenue from this app.
(4) Debt and Credit Facility.
Currently, there is $11m debt outstanding. The interest rate is around 5% to 6%. Cash is around $5m.
(5) Insider holding, options, Insider trading info, share buyback.
Benjie Levy: 5m share. around 2%.
JOHN ALBRIGHT: Director, 51m shares, Relay Venture.
(7) Industry comparison.
ESPN: is its major competitor.
Yahoo Sports:
(8) Major events
2. Financial data.
3. Valuation
(1) Currently, the company generates no profit. May just close to cash even. It is hard to evaluate it based on profitability.
(2) If just based on revenue, it generates around 30m revenue currently. The current market cap is close to 4 times its annual revenue. Not really cheap.
4. Risk
(1) Generally, Ad revenue is very bad revenue source since its customer can easily cut back on marketing spending and also it can easily lose customers.
(2) It is hard to tell whether it can continue growing its user base. The competition in mobile apps in very tough. It is losing users on the Android platform.
5. Conclusion
The company was managed very well and grew very well. However, it is still a very risky business and the current price is not cheap.
6.Links
