Sunday Research Pipeline Session #4 - Has Recurring Revenue Reached an Inflection Point?
Slowly building a compounding machine
It’s refreshing to see that after one month of starting to post some notes from our research pipeline, that alpha is already being generated.
The average return of the five Stocks profiled in our journal posts is tracking nicely at 17%.
As a reminder, this new feature brings you our research pipeline even earlier. Most, are stocks that haven’t been added to the Microcap Quality Index (MSMqi,) but are candidates.
I’ve watched this next company through my side-view mirror for many years. I’ve finally become more interested to dig deeper as the recurring revenue piece of the business is finally beginning to approach a substantial percentage of overall revenue.
Furthermore, the company is beginning to exhibit one of my most favorite multibagger traits, getting more revenue from its current customers. In this case, this is occurring as the maintenance revenue of installed software begins to pile up, as the company adds new services.
I don’t think it’s quite ready to be added to MSMqi, but it could be getting close, pending further research.
I hope you enjoy this next research journal entry. It’s a little longer than my previous journal entries, because it’s probably closer to being added to MSMqi and because I have been following the company for many years.