- In the past several weeks, Spok Holdings has been removed from a couple of sets of indices, which has contributed to a steep sell-off in the stock price.
- Spok's legacy wireless paging business is in steady decline. Sales efforts for Spok Go, their new cloud-native hospital communications SaaS platform, have been impeded by the pandemic.
- Management has indicated that they won't go on a crusade with Spok Go and can revert to a cash flow maximization model if they aren't getting traction with the new platform.
- Another path to upside would be a sale of the business. A $12/share offer back in March 2020 was motivated by the ability to cut back on overhead costs.
- For an entry price below $8, it looks like upside outweighs the downside.
For further details see:
Spok Holdings: New SaaS Platform Slow To Gain Traction, But Upside Outweighs Downside