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Accordingly, this document should not be construed as an endorsement or recommendation of the companies or securities discussed herein. I am not an investment advisor and this is not an investment thesis. It is merely one part of the story, which I present for debate in hopes of determining all risks and upside potential. The disclosure at the end of this piece is critical to understanding the content of this document. Further, I frequently trade my positions and may buy, sell, or short the securities mentioned herein at any time, regardless of the facts or perceived implications of this article.
Momentum appears to be building around Smith Micro’s (SMSI) Safe & Found product for Sprint. One of our readers shared a link to Android app data showing that SMSI’s product has now been downloaded over 100,000 times… and that’s just Andriod. I haven’t seen any iPhone data, but it should be in the ballpark (on an apples to apples basis).
FYI, my estimate is that Sprint has (had) about 350,000 customers on its old (Location Labs) family protection app. So, nice progress is being made with SMSI’s new app.
It should be noted that there are a fair number of bad reviews for Safe & Found. However, it should be noted that 1) there are only a few hundred bad reviews, which is low for an app with over 100,000 downloads, 2) I tested the app with a family and we came away happy / impressed, and 3) this is not the type of app for which happy customers leave reviews. In fact, we didn’t leave a review despite owning a lot of the stock! Perhaps I should remedy that…
Also, I spoke to the company last week and they are intentionally using the negative feedback as to improve the product. It’s actually common for app developers to let user feedback serve as their beta test. As long as most customers are happy, they can always fix the product (it’s just software) and go back to the unhappy ones with a refined product.
FYI, I believe that version 6.0 of SafePath is just a few weeks from release (June). You’ll notice, from the graphic above, that the Sprint version of SafePath (Safe & Found) is only on version 1.0.23, so they’re deep into the first version (thus the “.0.23”), but it’s still just the first version. We’re still in the early innings folks.
Crossing the 100,000 download threshold (on Android alone) is bullish for SMSI. It means they should be recognizing some meaningful revenue (which should show up in the Q2 results). It also shows that SMSI is firmly entrenched at Sprint. This correlates well with data points which suggest that Sprint will completely stop offering the old product in the late-May timeframe.
This is all bullish for SMSI.
Perhaps this is why the company is finally going out on the road to tell the story to institutional investors (next week). I believe that Chardon is playing a part in this road show, which could lead to an initiation of coverage. That’s just speculation. However, from what I’ve seen / heard, I’m very confident that new investors will be very interested in the SMSI story, especially considering the implications for its operating model.
This is why I’ve continued to add to my position on pullbacks.
My next post will review my notes from SMSI’s earnings call and my subsequent conversation with the company.
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Disclosures / Disclaimers: I am long SMSI. However, this is not a solicitation to buy, sell, or otherwise transact any stock or its derivatives. Nor should it be construed as an endorsement of any particular investment or opinion of the stock’s current or future price. To be clear, I do not encourage or recommend for anyone to follow my lead on this or any other stocks, since I may enter, exit, or reverse a position at any time without notice, regardless of the facts or perceived implications of this article.
I am not a financial advisor. Nor am I providing any recommendations, price targets, or opinions about valuation regarding the companies discussed herein. Any disclosures regarding my holdings are true as of the time this article is written, but subject change without notice. I frequently trade my positions, often on an intraday basis. Thus, it is possible that I might be buying and/or selling the securities mentioned herein and/or its derivative at any time, regardless of (and possibly contrary to) the content of this article.
I undertake no responsibility to update my disclosures and they may therefore be inaccurate thereafter. Likewise, any opinions are as of the date of publication, and are subject to change without notice and may not be updated. I believe that the sources of information I use are accurate but there can be no assurance that they are. All investments carry the risk of loss and the securities mentioned herein may entail a high level of risk. Investors considering an investment should perform their own research and consult with a qualified investment professional.
I wrote this article myself, and it expresses my own opinions. I am receiving no compensation for it, nor do I have a business relationship with any company whose stock is mentioned in this article. The information in this article is for informational purposes only and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.
The primary purpose of this blog/forum is to attract new contacts with professional industry expertise to share research and receive feedback (confirmation / refutation) regarding my investment theses.