Sezzle (SZL) Fundamentals & Technicals - FAILED ACQUISITION! ASX
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Sezzle (SZL) Fundamentals & Technicals – FAILED ACQUISITION! ASX



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Written by Demoniaco ASX

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  1. Hi I'm a SZL long (my average purchase price is under A$1.20 though, I can't imagine the people who paid A$10 a share for this thing) so take everything I say with a grain of salt.

    One thing I think your analysis missed is that the business has a decent seasonality to it, that's why you see a big gain in the 4th quarter and a retraction in the 1st quarter. It's more accurate to compare YoY growth numbers than QoQ to correct for this effect, though you're ultimately right that there hasn't been much growth recently.

    Also I think you flipped a sign on the cash from investing in the analysis, they didn't take out debt they used cash to pay down debt. For Q1 I think they were negative something like 5.5 million dollars (that's taking the cashflow from operations number and subtracting out all the provisions for uncollectibles).

    If you read their filings they're guiding pulling 17M in annual costs out of the business, which ends up being 4.25M per quarter and is mostly firing people and spinning down expansions so that seems achievable. Taking into account seasonality that may be enough to push them into cash flow break even, and then the question for investors is whether you think this thing can grow decently thereafter.

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