Author Topic: PAR - PAR Technology Corporation  (Read 4325 times)

whatdadil9

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PAR - PAR Technology Corporation
« on: June 27, 2018, 10:01:32 AM »
Anyone looked at this?

ADW just filed in it.

They had some interesting commentary on the last qtrs. conference call....seems very assymetric.
« Last Edit: June 28, 2018, 04:32:51 PM by Parsad »


KJP

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Re: PAR
« Reply #1 on: June 27, 2018, 12:03:19 PM »
Yes.  As usual, I sold too soon, largely because of concerns about management.  There's a VIC writeup about it from 2016 that hits the highlights.   

Foreign Tuffett

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Re: PAR
« Reply #2 on: June 27, 2018, 12:35:21 PM »
Anyone looked at this?

ADW just filed in it.

They had some interesting commentary on the last qtrs. conference call....seems very assymetric.

Can you elaborate on what seems "assymetric" here? Also, is the 2nd "s" an understated commentary on management's abilities (or lack thereof)?

wisowis

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Re: PAR
« Reply #3 on: June 27, 2018, 01:54:43 PM »
Voss Capital is a big investor in this (owns ~7% of the company). They do value investing in the software space - see Southpaw's posts on the board.

Here is the long thesis that they posted on their twitter last year - "PAR: A Framework for $30". Attached.

whatdadil9

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Re: PAR
« Reply #4 on: June 27, 2018, 02:02:16 PM »
I think the VOSS analysis applies roughly as it relates to unit count ( perhaps is conservative).

I think what they miss that ADW points out on the call is payments. Toast their closest competitor has a 100 pct capture rate on payments. Given Par is tilted towards enterprise its unlikely they get a 100 pct capture rate but 50 pct is not unreasonable.

If PAR has 30k boxes in 2020 at 1.5mm of AUV thats 45bn of transaction value. Say they get 22.5bn of it and make 50 bps NET that's almost 120 mm of EBITDA in payments....Put a 10x multiple on that and its 1.2bn alone.

SAAS at 30k units is 60m assuming no additional modules or ARPU growth... 60mm of SAAS at 10x is worth 600mm. Public market multiples for those growth rates prob render higher.

Govt is probably worth 100 ( alot of corp allocation making results look lower than are)

Hardware has a good amount of WC and prob could be liscenced to Asia. I think we could take 75mm out of that biz. You will also sitll have the liscencing, support and maintenance revenue. Not sure what that is woth.

Surecheck prob worth 20

RE prob worth 20-30.

If you add up all the legacy businesses you get to the company's existing market cap --- ascribing zero value to brink / payments which are enormous...


KJP

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Re: PAR
« Reply #5 on: August 12, 2018, 09:06:39 AM »
I think the VOSS analysis applies roughly as it relates to unit count ( perhaps is conservative).

I think what they miss that ADW points out on the call is payments. Toast their closest competitor has a 100 pct capture rate on payments. Given Par is tilted towards enterprise its unlikely they get a 100 pct capture rate but 50 pct is not unreasonable.

If PAR has 30k boxes in 2020 at 1.5mm of AUV thats 45bn of transaction value. Say they get 22.5bn of it and make 50 bps NET that's almost 120 mm of EBITDA in payments....Put a 10x multiple on that and its 1.2bn alone.

SAAS at 30k units is 60m assuming no additional modules or ARPU growth... 60mm of SAAS at 10x is worth 600mm. Public market multiples for those growth rates prob render higher.

Govt is probably worth 100 ( alot of corp allocation making results look lower than are)

Hardware has a good amount of WC and prob could be liscenced to Asia. I think we could take 75mm out of that biz. You will also sitll have the liscencing, support and maintenance revenue. Not sure what that is woth.

Surecheck prob worth 20

RE prob worth 20-30.

If you add up all the legacy businesses you get to the company's existing market cap --- ascribing zero value to brink / payments which are enormous...

Adam Wyden drilled home many of these points to management in the latest call.  It's not clear they understand his point about how raising capital at the Brink level may be the best way to fund the business or, more broadly, that they're in a land grab situation so more capital now could be very valuable long term. 

Transcript here:  https://seekingalpha.com/article/4198254-par-technology-corporation-par-ceo-donald-foley-q2-2018-results-earnings-call-transcript?part=single
« Last Edit: August 12, 2018, 09:25:37 AM by KJP »

wisowis

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Re: PAR
« Reply #6 on: August 12, 2018, 05:31:10 PM »
I think the VOSS analysis applies roughly as it relates to unit count ( perhaps is conservative).

I think what they miss that ADW points out on the call is payments. Toast their closest competitor has a 100 pct capture rate on payments. Given Par is tilted towards enterprise its unlikely they get a 100 pct capture rate but 50 pct is not unreasonable.

If PAR has 30k boxes in 2020 at 1.5mm of AUV thats 45bn of transaction value. Say they get 22.5bn of it and make 50 bps NET that's almost 120 mm of EBITDA in payments....Put a 10x multiple on that and its 1.2bn alone.

SAAS at 30k units is 60m assuming no additional modules or ARPU growth... 60mm of SAAS at 10x is worth 600mm. Public market multiples for those growth rates prob render higher.

Govt is probably worth 100 ( alot of corp allocation making results look lower than are)

Hardware has a good amount of WC and prob could be liscenced to Asia. I think we could take 75mm out of that biz. You will also sitll have the liscencing, support and maintenance revenue. Not sure what that is woth.

Surecheck prob worth 20

RE prob worth 20-30.

If you add up all the legacy businesses you get to the company's existing market cap --- ascribing zero value to brink / payments which are enormous...

Adam Wyden drilled home many of these points to management in the latest call.  It's not clear they understand his point about how raising capital at the Brink level may be the best way to fund the business or, more broadly, that they're in a land grab situation so more capital now could be very valuable long term. 

Transcript here:  https://seekingalpha.com/article/4198254-par-technology-corporation-par-ceo-donald-foley-q2-2018-results-earnings-call-transcript?part=single

Just listened to the call, and wow, Adam really spent a lot of time and effort in driving that point home. I am worried that his understanding and vision of the company sounded more articulate than management's. Several times, management just responded with "we hear ya".


walkie518

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Re: PAR
« Reply #7 on: August 13, 2018, 11:13:04 AM »
I think the VOSS analysis applies roughly as it relates to unit count ( perhaps is conservative).

I think what they miss that ADW points out on the call is payments. Toast their closest competitor has a 100 pct capture rate on payments. Given Par is tilted towards enterprise its unlikely they get a 100 pct capture rate but 50 pct is not unreasonable.

If PAR has 30k boxes in 2020 at 1.5mm of AUV thats 45bn of transaction value. Say they get 22.5bn of it and make 50 bps NET that's almost 120 mm of EBITDA in payments....Put a 10x multiple on that and its 1.2bn alone.

SAAS at 30k units is 60m assuming no additional modules or ARPU growth... 60mm of SAAS at 10x is worth 600mm. Public market multiples for those growth rates prob render higher.

Govt is probably worth 100 ( alot of corp allocation making results look lower than are)

Hardware has a good amount of WC and prob could be liscenced to Asia. I think we could take 75mm out of that biz. You will also sitll have the liscencing, support and maintenance revenue. Not sure what that is woth.

Surecheck prob worth 20

RE prob worth 20-30.

If you add up all the legacy businesses you get to the company's existing market cap --- ascribing zero value to brink / payments which are enormous...

Adam Wyden drilled home many of these points to management in the latest call.  It's not clear they understand his point about how raising capital at the Brink level may be the best way to fund the business or, more broadly, that they're in a land grab situation so more capital now could be very valuable long term. 

Transcript here:  https://seekingalpha.com/article/4198254-par-technology-corporation-par-ceo-donald-foley-q2-2018-results-earnings-call-transcript?part=single

Just listened to the call, and wow, Adam really spent a lot of time and effort in driving that point home. I am worried that his understanding and vision of the company sounded more articulate than management's. Several times, management just responded with "we hear ya".

they seemed to do that on the last call as well

ADW appears to have filed a 13D
https://www.sec.gov/Archives/edgar/data/708821/000138713118003839/0001387131-18-003839-index.htm

wisowis

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Re: PAR - PAR Technology Corporation
« Reply #8 on: October 21, 2018, 01:38:29 PM »
ADW and Voss Capital have now both publicly called for the company to be sold. Combined they own ~18% of the company (?)

ADW letter: https://www.prnewswire.com/news-releases/adw-capital-seeks-strategic-alternatives-process-to-pursue-immediate-sale-of-par-technology-300729472.html
Voss letter: https://mma.prnewswire.com/media/769201/Voss_ADW_Letter.pdf

The ADW letter is particularly scathing.

walkie518

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Re: PAR - PAR Technology Corporation
« Reply #9 on: October 22, 2018, 10:23:22 AM »
ADW and Voss Capital have now both publicly called for the company to be sold. Combined they own ~18% of the company (?)

ADW letter: https://www.prnewswire.com/news-releases/adw-capital-seeks-strategic-alternatives-process-to-pursue-immediate-sale-of-par-technology-300729472.html
Voss letter: https://mma.prnewswire.com/media/769201/Voss_ADW_Letter.pdf

The ADW letter is particularly scathing.
To be fair, I'm not sure why mgmt is so hesitant to the idea...every conf call they say, "we understand," but do not seem to budge in any direction. 

Splitting the businesses apart makes a lot of sense considering where public markets are trading...though I don't understand why the market is so negative on the stock when there is so much underlying value and there is attention...maybe ADW and Voss are simply not well known enough