High flying BSM Technologies (TSXV:GPS) is only scratching the surface of its market potential, says the company’s CEO.
Aly Rahemtulla, President and CEO of BSM attended the M Partners Tech 13 Conference in Toronto this morning. While the company’s stock has been one of the better performers in the entire tech sector of late, Rahemtulla says the company has plenty of runway to continue its growth.
BSM, which is already experiencing a compound annual growth rate in excess of 15%, is looking ahead to markets that are still relatively unpenetrated, he says.
The BSM Technologies CEO points to the market for fleet management systems, which were are only at 7.9% penetration in 2011 and will reach more than 16% by 2015. A recent study by research firm MarketsandMarkets, called “Fleet Management Market (Fleet Analytics, Vehicle Tracking & Fleet Monitoring, Telematics, Vendor Services) By Vehicles (Trucks, Light Goods, Buses, Corporate Fleets, Container Ships, Aircrafts) Worldwide Market Forecasts and Analysis (2013 – 2018)”, says the global Fleet Management market will grow from $10.91 billion in 2013 to $30.45 billion by 2018, a Compound Annual Growth Rate of 22.8%.
M Partners analyst Shuttleworth, who recently initiated coverage of BSM with a BUY rating, says the company is showing “emerging dominance” in the rail segment of its business. He thinks the company can create earnings leverage through a recurring revenue business model in market niches that are tightly defined. He notes that BSM has already landed four of the six Class One railroads in North America, yet at a deployment completion rate of just 15% so far, there is still about $70-million in revenue left in the rollout of that vertical alone.
Founded in 1997, the Woodbridge-based company sells GPS technologies that manage large fleets of trucks and secure other mobile assets, monitor fixed assets and automate vehicle security. The company’s Q3 revenue of of $4.68-million was a 39% bump over last year’s third quarter.