1. While most of the customers who signed up are not known by name, there seem to be some questionable companies in those that are known. As a result, we can't exclude the possibility that the backlog number ($933M per this morning) could be overly aggressive and there seems to be at least some recognition from management as they guide 2019 at 75%-80% conversion, not their historic 100%.
   
2. The previous history of their CFO appears to have some problems.
   
3. The fact that competitor Twilio needs a much higher level of OpEx, providing the CPaaS services seems to require more manpower at Twilio than at Pareteum. Despite doubling revenue, operating cost haven't increased all that much at Pareteum last year. While I previously considered that a sign of potential great operating leverage, it's odd that this isn't visible in a much larger competitor.
   

1. The whole CPaaS sector is growing fast.
   
2. Organic revenue growth of 101% in 2018.
   
3. Management guided 2018 revenue very conservatively (50%+ growth), curious for a management that is accused of being very aggressive.
   
4. Having Vodafone as its biggest customer, good for 40% of revenue.
   
5. The recent deal with Citrix, indicating iPass (which was ailing prior to the acquisition) business can be revived.
   
6. The 12M shares in bought by Hoving Partners, Swiss wealth management managed by a former non executive Artilium director.
   

Quote:The last time Pareteum broke out the backlog by year was in their AGM presentation in September. It was $375 million at the time. Here it is:

What is curious about this table is that the 2019 revenue backlog is $84 million. At a glance that makes sense – the guide was higher than that after all. But wait, Pareteum has made two acquisitions that are included in guidance. This backlog should be for pre-acquisition Pareteum as neither acquisition was closed. What’s more, Pareteum has added more than $200 million to the backlog since that time. One would think some of that would fall into 2019. If we take the SEC projections for iPass and Artilium at face value, the 2019 guidance is only forecasting $15 million to $25 million for stand-alone Pareteum. How does that align with this massive backlog? It’s actually lower revenue than stand-alone Pareteum had in 2018. Again, I’m left wondering how to make the numbers work..

• Company guidance for 2019 revenue is $105M-$115M (which was already lower by quite a bit compared to the November iPass presentation where they had this at $144M, the difference being 80% versus 100% conversion).
  
• But on the AGM in August last year, they guided backlog at $84M for 2019, supposedly excluding Artilium and iPass (which together were guided at nearly $75M in revenues before the acquisition, $43.3M for iPass and $31.6M for Artilium).
  
• It's not as bad as the author of above article claims, stand alone Pareteum (ex Artilium and iPass) revenue is $30M-$40M, not the $15M-$25M the author claims, but that's still much less than the $84M of backlog it supposedly has in 2019 (and probably more as backlog has since grown considerably). This suggest a conversion rate well below 50%. We will know a lot more when we have the Q1 numbers, but this isn't increasing my confidence..
  

(04-10-2019, 02:05 AM)admin Wrote: I have to admit that my comfort level with Pareteum is decreasing a bit due to a couple of critical articles and comments. I feel that I can't entirely ignore these criticisms and we think investors in general should not ignore other opinions of their stock, even if they're completely the opposite of one's own opinion.

Here is some of the stuff I'm uncomfortable with as I don't have ready answers and can't argue these away:

1. While most of the customers who signed up are not known by name, there seem to be some questionable companies in those that are known. As a result, we can't exclude the possibility that the backlog number ($933M per this morning) could be overly aggressive and there seems to be at least some recognition from management as they guide 2019 at 75%-80% conversion, not their historic 100%.
   
2. The previous history of their CFO appears to have some problems.
   
3. The fact that competitor Twilio needs a much higher level of OpEx, providing the CPaaS services seems to require more manpower at Twilio than at Pareteum. Despite doubling revenue, operating cost haven't increased all that much at Pareteum last year. While I previously considered that a sign of potential great operating leverage, it's odd that this isn't visible in a much larger competitor.
   

Keep in mind that the fact that we can't answer these doesn't necessarily mean that they don't have satisfying answers.

In case you think I'm changing my mind 180 degrees and turned into a short, no. There are a number of positives that stand quite solidly and are difficult to deny, like:

1. The whole CPaaS sector is growing fast.
   
2. Organic revenue growth of 101% in 2018.
   
3. Management guided 2018 revenue very conservatively (50%+ growth), curious for a management that is accused of being very aggressive.
   
4. Having Vodafone as its biggest customer, good for 40% of revenue.
   
5. The recent deal with Citrix, indicating iPass (which was ailing prior to the acquisition) business can be revived.
   
6. The 12M shares in bought by Hoving Partners, Swiss wealth management managed by a former non executive Artilium director.
   

Longs can take comfort in these six facts. 
Whatever exactly the reality is, sentiment seems to have turned as the stock seems to be unable to rally further on good news. I realize people might even get angry at me for writing this, but I feel one should be as open as possible to conflicting information and alternative readings of the facts and I feel I have a duty my followers to also point out potential pitfalls. We should at least discuss these things open, here.

(04-10-2019, 05:57 AM)Patc Wrote: Surprised you got scared out that quickly.  So you give more credibility to some bloggers than you do to 3 or 4 analysts

(04-10-2019, 06:17 AM)Vincehap Wrote: Thank you SHU. I had admired and appreciated you and your works. And because of this frank concern of TEUM, I admire and appreciate you more. I only wish you could do this in one of your articles on SeekingAlpha.
Sincerely,
Vincehap