04-12-2019, 11:14 PM
Here is another way of looking at it: I'm actually not saying anything new. The fact that no long is defending their backlog numbers shows that I'm saying out loud which what most already know anyway.
For instance, the company guided 2019 revenues at $144M in November in the iPass acquisition presentation and that came down to $105M-$115M during the Q4CC whilst in between, backlog has almost doubled in-between.
The explanation they gave for that is that conversion moved from 100% to 75%-80%, basically not even management has faith in their own backlog numbers.
The question really is by how much these backlog numbers are overstated. They have a substantial margin here, which is somewhat reassuring. That is, you can cut backlog in half and the company would still grow revenues substantially, which is indeed what they've been doing.
But how comfortable are investors with a management that is so aggressive with these numbers?
For instance, the company guided 2019 revenues at $144M in November in the iPass acquisition presentation and that came down to $105M-$115M during the Q4CC whilst in between, backlog has almost doubled in-between.
The explanation they gave for that is that conversion moved from 100% to 75%-80%, basically not even management has faith in their own backlog numbers.
The question really is by how much these backlog numbers are overstated. They have a substantial margin here, which is somewhat reassuring. That is, you can cut backlog in half and the company would still grow revenues substantially, which is indeed what they've been doing.
But how comfortable are investors with a management that is so aggressive with these numbers?