Alex RuusD-Box TechnologiesDBO.TOCOMMENTSep 27, 2017

He is not sure why the stock is doing so poorly except that money is being sucked out for other sectors. A lot of these companies have never been better valued. They had a great quarter last quarter. They announced a lot of new systems post-quarter. They are reinvesting in sales and marketing. The sales have never been better. He is holding on. It needs a large announcement with a large US chain.

Seats for movie theatres. They also make them for simulation in other industrial applications. They have been releasing better and better results and no analyst has caught on to it. They have huge customers in Canada. It is only a matter of time when these seats catch on in Canada.

Motion seating for theaters. They are getting into a bit of a problem. Markets are going to stop caring about them. The bottom line is doing nothing.

While blockbuster movies, like Black Panther, are helping theaters now, box offices are facing significant challenges. Reflecting the challenge, theaters are replacing their current seats with recliner style seats, which is what D-Box offers. Their seats also provide shake-and-quake with the movie. They are now sharing in theater revenue, and Cineplex is continuing to reorder these seats for additional locations. As adoption increases, there is more recurring revenue. The company is not yet profitable. There is an expected loss in 2018, breakeven in 2019, and earn 3 cents per share in 2020. This looks like a reasonable investment over the next three years.

They are just breaking even but cash flow positive. They not only sell motion systems but also lease them. You have to look at gross sales as well as rental income. They have a version in the reclining movie theatre seats now. He expects some big orders from AMC-N.

(Top Pick Sep 22/16, Down 54%) They hit a bit of a speed bump as a lot of theatres are upgrading their seats to reclining ones. They have adapted their product and so should recover over the next few quarters. He thinks there is a deal coming with AMC theatres as they are now advertizing that they use DBO-T seats. It is a great time to buy.

(Top Pick Jun 29/16, Down 52.23%) They just had a great quarter, but the backlog went way down in the commercial movie theatre side. The backlog is now way up. The year was disappointing, however. Growth is enormous for them now.

He is a fan of this. They have a lot of contracts with companies like Cineplex (CGX-T). They are slowly adding their motion seats to theatres. Momentum was looking good, but recently deal volumes was falling off a little. He wouldn’t be adding until he could see more seats being installed in theatres.