27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.
Communications provider Pareteum Corp. (NYSE:TEUM) exhibits well-executed turnaround, underappreciated growth and tremendous share upside.
The Analyst
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Lake Street Capital Markets analyst Eric Martinuzzi initiated coverage on Pareteum with a Buy rating and a $5 price target.
The Thesis
In Monday’s note, Martinuzzi outlined the company’s evolution over the past three years, including some highlights such as:
- The addition of new Executive Chairman, Hal Turner and the multi-phased turnaround effort in 2015.
- In 2016, the company sold ValidSoft, changed names from Elephant Talk to Pareteum, and revolutionized the business structure and focus to a new communications platform as a service. Later that year, the company returned to profitability and hired CEO Vic Bozzo.
- 2017 featured a new customer base with 26 contracts covering 45 countries, as well as a strengthened management team and 5 percent growth.
- In 2018, revenue grew over 60 percent as the company expects to close on the acquisition of Artilium, which will bolster the company’s competitive profile, Martinuzzi said. According to the note, this model assumes the deal closes on Sept. 30.
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According to Martinuzzi, one of the potential investment risks surrounding Pareteum stock involves revenue concentration.
“As of Q2’18 two customers (Vodafone and Zain) made up 75% of total revenue. This is down from 97% in Q2’17. While this is a significant exposure, we do not believe either relationship is at risk. We expect the implementation of new accounts in backlog to reduce the risk over time.”
Price Action
Pareteum shares closed up 4.9 percent at $2.97 Monday.
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27% profit every 20 days?
This is what Nic Chahine averages with his option buys. Not selling covered calls or spreads… BUYING options. Most traders don’t even have a winning percentage of 27% buying options. He has an 83% win rate. Here’s how he does it.