LiveTiles Ltd (ASX: LVT)

LVT Details

Meteoric rise in annualised subscription revenue: LiveTiles Ltd, the information technology player that offers digital workplace platforms, including user experience-focused solutions to the enterprise, education and small and midsized business (SMB) markets, slipped by 6.7% on January 19, 2018 with investors seemingly booking profits on the stock. The group recently announced that its quarterly annualised subscription revenue (ASR) reached $6.9 million as at 31 December 2017, which is a significant growth on $5.0 million as at 30 September 2017 and $2.0 million as at 31 December 2016. Thus, the ASR grew by 245% in the last one year. LVT expects the growth to continue in 2018.
 

ASR Trend (Source: Company Reports)
 
The group also witnessed a significant step-up in the sales pipeline based on enhanced investment efforts. Further, LVT’s products that have been based on Artificial Intelligence technology (LiveTiles Bots and LiveTiles Intelligence) were promoted to Fortune 500 companies, in partnership with Microsoft, as per LVT’s latest announcement. The group has thus expanded its footprint in the past two years. With cloud market having an estimated CAGR of 21.5% from 2015-2020 and LVT’s growth rate of about 6x the rate of Software-as-a-service industry, the group has been able to benefit from its position.
 

Milestones over last 2 years (Source: Company Reports)
 
While the group is set to release its Q2 results in late January with insights on growth and operations, the positive catalysts have already helped the stock zoom up quite a bit with a 361.5% rise in last one year (as at January 18, 2018). On the other hand, the return on equity is well below the 6.3% average industry value.We believe investors having low appetite for risk can leverage from the latest rally and “Sell” the stock at the current price of $0.56


LVT Daily Chart (Source: Thomson Reuters)

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