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SeeThruEquity Issues Company Update on Net Element

Tuesday, 21 November 2017 09:00 AM

SeeThruEquity

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NEW YORK, NY / ACCESSWIRE / November 21, 2017 / SeeThruEquity, a leading independent equity research and corporate access firm focused on smallcap and microcap public companies, today announced that it has issued a company update on Net Element, Inc. (NASDAQ: NETE).

The note is available here: NETE November 2017 Update Note.

Highlights of the note are as follows:

On November 14, 2017, Net Element reported 3Q17 results, with highlights as follows:

  • 3Q17 revenues grew by 6.4% YoY to reach $14.9mn, versus $14.0mn in the year-ago period. Revenue for the first nine months of 2017 were $44.6mn, versus $39.0mn in the comparable year-ago period.
  • NETE benefitted from a 17.3% annual increase in its North American Transaction Solutions segment, which was attributed an increase in merchants and higher uptake of value-added services.
  • Net loss to common shareholders in 3Q17 was ($1.7mn), with a loss per share of ($0.90), versus a loss of ($3.5mn), or ($2.47) per share in 3Q16.

NA Transaction revenues rise by 17.3% YoY

NETE's revenues grew by 6.4% in 3Q17 to reach $14.9mn, as strong North American Transaction Solutions were offset by a decline in mobile solutions. NETE's NA Transactions segment grew revenues by 17.3% YOY to $13.1mn. This is a segment that now comprises 88.1% of total revenues. NA Transactions includes Unified Payments, a provider of comprehensive turnkey, payment processing solutions, as well as Aptito, a cloud-based Software-as-a-Service ("SaaS") restaurant management solution.

NETE made several enhancements to its service offerings in the NA Transaction Solutions segment during the quarter. These included the launch of web-based, integrated same-day ACH payment processing, as well as the launch of a payment acceptance module for popular mobile instant messaging platforms, including Facebook Messenger. NETE also launched what may have the potential to become a popular new feature for its merchant customers in the new "Zero Fee" program. Zero Fee is a new program that lets merchants pass along credit card processing fees directly to its customers.

NETE maintains Nasdaq CM listing status

NETE disclosed in its 10-Q that it was able to meet continued listing requirements for the Nasdaq CM ahead of the October 20, 2017, deadline for reaching compliance. The company completed a 1:10 reverse share split on October 5, 2017, and was able to raise $1.1mn after the end of the quarter in order to meet the $2.5mn shareholders' equity requirement. Funds were raised as part of the company's previously announced $10mn stock purchase agreement with Cobblestone Capital.

New target of $10.30 for NETE

Our price target for NETE moves to $10.30 following the reverse split and recent results. The target suggests a fair valuation of 0.5x EV / Revenue on 2017E revenues of $63.3mn. We continue to see NETE as an intriguing high risk / high reward growth company in the financial technology space.

Please review important disclosures on the company's website at www.seethruequity.com.

About Net Element, Inc.

Net Element (NASDAQ: NETE) is a global payments-as-a-service, technology provider with an integrated mobile and transactional services platform serving millions of emerging market clients. Its wholly owned subsidiary, TOT Group operates Unified Payments, a U.S. focused transaction processing and value-added services brand, Aptito, a next generation, cloud-based point of sale payments platform and TOT Money, a leading mobile payments service provider that is gaining significant traction in the mobile payments market in Russia and for two consecutive years, has been ranked in the Top 3 mobile payments providers by Beeline, Russia's second largest telecommunications operator.

Further information is available at www.netelement.com.

About SeeThruEquity

Since its founding in 2011, SeeThruEquity has been committed to its core mission: providing impactful, high-quality research on underfollowed smallcap and microcap equities. SeeThruEquity has pioneered an innovative business model for equity research that is not paid for and is unbiased. SeeThruEquity is the host of acclaimed investor conferences that are the ultimate event for publicly traded companies with market capitalizations less than $1 billion.

SeeThruEquity is approved to contribute its research reports and estimates to Thomson One Analytics (First Call), the leading estimates platform on Wall Street, as well as Capital IQ and FactSet. SeeThruEquity maintains one of the industry's most extensive databases of opt-in institutional and high net worth investors. The firm is headquartered in Midtown Manhattan in New York City.

For more information visit www.seethruequity.com.

Contact:

SeeThruEquity
[email protected]

SOURCE: SeeThruEquity

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