- SMSI’s 4Q21 results and 1Q22 guidance were weak, leading to the stock selling off by 25% following their report.
- Specific concern seems to be related to the company’s working capital position, and whether they need more money to get over the hump.
- Even if the company desires more cash in the short term, they currently have no debt, so no dilution should be needed with cheap debt being an option.
- Despite delays over the past few years related to the Sprint/T-Mobile merger and COVID-19, the fundamental story remains unchanged and is perhaps stronger than ever.
- SMSI could be at a $1.00/share EPS run-rate by EOY23, making the current $3.00/share price look absurd.
For further details see:
Smith Micro: Investors Missing The Forest For The Trees