Lake Street has commenced coverage on ACCESS Newswire, assigned with a "Buy" rating and a price target set at $15. ACCESS Newswire, symbolized under the ticker (ACCS, Financial), stands as the fourth largest distributor of press releases on a global scale.
The company is currently enhancing its focus on communications by transitioning into a comprehensive investor relations and public relations media software suite. This strategic shift includes the recent divestment of its compliance business, enabling ACCESS to adopt a subscription-based pricing model aimed at boosting gross margins.
With this transformation, ACCESS Newswire is well-positioned for future growth, according to Lake Street's analysis. The structural changes are expected to result in performance improvements and drive value for shareholders.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 1 analysts, the average target price for ACCESS Newswire Inc (ACCS, Financial) is $13.00 with a high estimate of $13.00 and a low estimate of $13.00. The average target implies an upside of 50.29% from the current price of $8.65. More detailed estimate data can be found on the ACCESS Newswire Inc (ACCS) Forecast page.
Based on the consensus recommendation from 1 brokerage firms, ACCESS Newswire Inc's (ACCS, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for ACCESS Newswire Inc (ACCS, Financial) in one year is $16.11, suggesting a upside of 86.24% from the current price of $8.65. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the ACCESS Newswire Inc (ACCS) Summary page.
ACCS Key Business Developments
Release Date: March 06, 2025
- Revenue (Q4 2024): $5.8 million, a 1% increase over Q4 2023.
- Full Year Revenue (2024): $23.1 million, a 6% decrease from 2023.
- Gross Margin (Q4 2024): 75%, consistent with Q4 2023.
- Full Year Gross Margin (2024): 76%, down from 77% in 2023.
- Operating Expenses (Q4 2024): Increased by $13.3 million, primarily due to a $14.15 million impairment loss.
- Net Loss from Continuing Operations (Q4 2024): $10.9 million or $2.85 per diluted share.
- Full Year Net Loss from Continuing Operations (2024): $13.3 million or $3.47 per diluted share.
- Non-GAAP Net Income (Q4 2024): $819,000 or $0.21 per diluted share.
- EBITDA (Q4 2024): $770,000 or 13% of revenue.
- Adjusted EBITDA (Q4 2024): $871,000 or 15% of revenue.
- Cash on Hand (End of 2024): $4.1 million, down from $5.7 million at the end of 2023.
- Cash Provided by Continuing Operations (Q4 2024): $353,000.
- Subscription Business Revenue (Q4 2024): Accounts for approximately 50% of overall revenues.
- Debt Reduction: Reduced by 78% or $12 million to $3.3 million.
- Customer Growth (End of 2024): 12,349 customers, a 4% increase over the prior year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- ACCESS Newswire Inc (ACCS, Financial) reported a 1% increase in revenue for Q4 2024, indicating some growth despite challenges.
- The company's subscription business now accounts for approximately 50% of overall revenues, up from 30% in the previous year.
- The sale of the compliance business significantly reduced debt by 78%, positioning the company for a debt-free future.
- Non-GAAP net income from continuing operations showed a positive trend, with $819,000 reported for Q4 2024.
- The company is focusing on expanding its subscription model, aiming for 75% of revenues from recurring subscriptions by the end of next year.
Negative Points
- Total revenue for the full year 2024 decreased by 6% compared to 2023, primarily due to lower volumes in the Newswire business.
- Operating expenses increased significantly due to a $14.15 million impairment loss associated with the Newswire trade name.
- The company reported a net loss from continuing operations of $10.9 million for Q4 2024, a substantial increase from the previous year.
- Cash on hand decreased from $5.7 million at the end of 2023 to $4.1 million at the end of 2024, partly due to debt repayments.
- The transition to a new business model and rebranding efforts have been time-consuming, impacting leadership focus and resources.
