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Asure (NASDAQ: ASUR) Completes Capital Raise to Fuel High-Interest Debt Reduction, Craig-Hallum Analyst Praises Move and Estimates Bullish Outcome

By: Spotlight Growth

August 28, 2023 at 06:45 AM EDT

It’s a very exciting time for Asure Software (NASDAQ: ASUR) after the company reported yet another quarterly result highlighted by substantial growth on its top and bottom lines. In fact, the company’s 50% y/y revenue growth during Q2 2023 to $30.4 million stands as the new record for top-line growth during a quarterly period. On the bottom-line, Asure saw its adjusted EBITDA surge to $6.1 million, which represented a $5.5 million improvement from the second quarter of 2022.

With bullishness continuing to build around Asure and its impressive growth streak, the company’s recently completed capital raise is positioned to help further add fuel to the fire. On August 21^st, Asure announced the closing of its public stock offering, which saw the selling of 3,333,333 newly issued shares of ASUR at a price per share of $12.00. This equates to net proceeds of $37.4 million after deducting offering expenses and underwriting fees.

The announcement, while initially met with some bearishness, has Wall Street pleased about the company’s prospects, as Asure has stated its intentions to utilize the proceeds to pay off high-interest debt and engage in further acquisition and/or investment activities. Here is what retail investors need to know about this capital raise and why it will likely help continue fueling Asure’s momentum.

Taking A Deeper Look Into The Debt In Focus

On September 10, 2021, Asure entered into a Loan and Security Agreement with Structural Captial Investments III, LP, and Ocean II PLO, LLC that provided the terms of lending up to $40 million with an interest rate of the prime rate plus 5.75%. According to Wall Street analyst, Jeff Van Rhee of Craig-Hallum, Asure’s outstanding balance from this credit facility stood at $32.2 million, as of June 30, 2023. Furthermore, the interest on this debt stood at around 14% cash rate and a 1% PIK (floating rate of prime + 5.75%), as of the end of the second quarter 2023.

As a result of removing this debt, Asure would remove a significant interest expense liability from its balance sheet, which would significantly strengthen its ledger.

Craig-Hallum Raises EPS Estimates In Recent Report

In an updated report issued on August 22, 2023, Jeff Van Rhee of Craig-Hallum, maintained a “buy” rating on the stock after raising the price target to $19 following the Q2 2023 financial results.

Mr. Van Rhee updated his full-year 2023 EPS estimate from $0.46 per share to $0.47 and from $0.52 to $0.61 per share for the full-year 2024. On a top-line revenue basis, the Wall Street analyst estimates full-year 2023 revenue of $118 million and $129.5 million in 2024. This gives Asure an estimated enterprise value-to-revenue ratio of 2.2x for full-year 2023 and 2.0x for 2024.

“The pace of product innovation is the best we’ve seen in our six years of coverage, as is the talent level and execution in sales. We find the shares highly attractive trading at 10x EBITDA while peers are at 22x. We see shares headed materially higher,” noted the updated report.

Overall, Asure continues to be on an impressive track, with even further growth estimated to continue over the coming quarters by Wall Street analysts. The potential removal of high-interest debt would be a critical example highlighting the continued strengthening of the company’s balance sheet and financial position. As we look forward to the remainder of 2023 and into 2024, the outlook for Asure continues to be very promising.

Disclaimer:

Spotlight Growth is compensated, either directly or via a third party, to provide investor relations services for its clients. Spotlight Growth creates exposure for companies through a customized marketing strategy, including design of promotional material, the drafting and editing of press releases and media placement.

All information on featured companies is provided by the companies profiled, or is available from public sources. Spotlight Growth and its employees are not a Registered Investment Advisor, Broker Dealer or a member of any association for other research providers in any jurisdiction whatsoever and we are not qualified to give financial advice. The information contained herein is based on external sources that Spotlight Growth believes to be reliable, but its accuracy is not guaranteed. Spotlight Growth may create reports and content that has been compensated by a company or third-parties, or for purposes of self-marketing. Spotlight Growth was compensated four thousand dollars cash by Asure Software for the creation and dissemination of this content by the company.

This material does not represent a solicitation to buy or sell any securities. Certain statements contained herein constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may include, without limitation, statements with respect to the Company’s plans and objectives, projections, expectations and intentions. These forward-looking statements are based on current expectations, estimates and projections about the Company’s industry, management’s beliefs and certain assumptions made by management.

The above communication, the attachments and external Internet links provided are intended for informational purposes only and are not to be interpreted by the recipient as a solicitation to participate in securities offerings. Investments referenced may not be suitable for all investors and may not be permissible in certain jurisdictions.

Spotlight Growth and its affiliates, officers, directors, and employees may have bought or sold or may buy or sell shares in the companies discussed herein, which may be acquired prior, during or after the publication of these marketing materials. Spotlight Growth, its affiliates, officers, directors, and employees may sell the stock of said companies at any time and may profit in the event those shares rise in value. For more information on our disclosures, please visit: https://spotlightgrowth.com/disclosures/

The post Asure (NASDAQ: ASUR) Completes Capital Raise to Fuel High-Interest Debt Reduction, Craig-Hallum Analyst Praises Move and Estimates Bullish Outcome appeared first on Spotlight Growth.

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Asure (NASDAQ: ASUR) Completes Capital Raise to Fuel High-Interest Debt Reduction, Craig-Hallum Analyst Praises Move and Estimates Bullish Outcome

Taking A Deeper Look Into The Debt In Focus

Craig-Hallum Raises EPS Estimates In Recent Report

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