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SmallCapPower
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Daily Stocks on the rise
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The Ubika Research Tech Stock Watchlist
| Guestlogix Inc (T.GXI) |
| Company Name: |
GuestLogix Inc. |
| HQ Location: |
Toronto, Ontario |
| Company Website: |
www.guestlogix.com |
| Shares Outstanding |
63.8 Million |
| Market Cap: |
$104 Million |
| 52 Week Range |
$0.51 - $1.97 |
| Closing Price (March 30, 2010) |
$1.63 |
| Average Daily Volume |
184,000 |
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Share Highlight / 1-Year Stock Chart
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Business Overview
GuestLogix is the leading global provider of onboard store technology which helps airlines build and manage onboard retail operations tailored to their needs and their passengers. Serving 35% of the global airline passenger traffic, GuestLogix has become a trusted partner to airlines around the world. The Company is headquartered in Toronto, Canada and maintains sales and support facilities in the US, UK, Singapore, and South Korea. GuestLogix is publicly traded on The Toronto Stock Exchange (Symbol: GXI). More information is available at guestlogix.com. + More info
What is interesting?
- Even though airlines have been a bad investment, servicing the airline industry can be profitable. Guest Logix is a great example of a service provider making money servicing the airline industry.
- GuestLogix is a dominant player that powers the retail business that happens within airplanes. When customers buy anything inside an airplane, they are most likely using GuestLogix hardware and software. GuestLogix has a retail transaction processing platform used by airlines around the world.
- GuestLogix virtually owns this space with 90% market share in North America and 35% worldwide.
- Guest Logix makes money based on the number and value of transactions done through its platform.
- More and more airlines are moving to a model to charge for additional services and looking at on board sales as a way to recoup their expenses and generate revenue.
- Discount or no frills airlines is redefining this industry by creating a business model were passengers pay for everything on board. More and more airlines for example are charging for food and other beverages, along with selling products via on board duty free store.
- In order to make money airlines are increasingly also selling additional services inside the plane. For example selling Disney tickets in flights to Florida or tickets for play in flights to New York or London. As airlines look for innovative ways to increase their onboard sales, GuestLogix stands to benefit.
- Air traffic worldwide is growing and the trend of no frills or discount airlines is increasing. Both these trends are favorable to GuestLogix. As more and more sales happen inside the plane during flight, it will benefit GuestLogix, as the average transaction value and the number of transactions both increase.
- GuestLogix is making significant customer wins in Europe and Asia Pacific.
- In the most recent quarter ending Feb 2010, the company reported a 50% growth in revenue from corresponding quarter last year. Company has positive EBITDA and also had a small positive Net Income in the most recent quarter.
- The company is expanding from airline industry to the rail industry. Rail is a major transportation mode in Europe and onboard retail is well advanced in this segment as well. GuestLogix is looking to Rail in Europe as the next big segment to go after given its expertise in onboard retail in airlines.
Risks
For the company to achieve growth, air traffic has to grow and continue without disruption. The recent volcanic ash problem in Europe leading to major disruption and terrorist attack of Sept 11th showed the vulnerability of air travel. Any such disruptions will affect GuestLogix revenues. GuestLogix needs to expand beyond airlines to other segments to sustain the growth rate given its already dominant position in the airline industry. While there is enough growth in international airlines market still, growth in medium term will have to involve expansion in rail and some acquisitions of complementary businesses. This move into new segments and acquisitions can present risk for the company. GuestLogix Inc. News
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