Route1 Inc (ROI) AI Stock Analysis

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Route1 Inc

(ROI)

47Neutral

Route1 Inc's overall score reflects significant financial challenges with declining revenues, negative profit margins, and high leverage. Despite these concerns, technical indicators show short-term bullish momentum, although caution is warranted due to possible overbought conditions. Valuation remains a concern due to the company's losses.

Route1 Inc (ROI) vs. S&P 500 (SPY)

Market Cap

C$4.25M

Dividend YieldN/A

Average Volume (3M)48.15K

Price to Earnings (P/E)―

Beta (1Y)1.28

Revenue Growth-13.79%

EPS Growth18.30%

CountryCA

Employees30

SectorTechnology

Sector Strength77

IndustrySoftware - Application

Share Statistics

EPS (TTM)-0.03

Shares Outstanding42,497,154

10 Day Avg. Volume51,246

30 Day Avg. Volume48,148

Financial Highlights & Ratios

PEG Ratio0.05

Price to Book (P/B)-7.04

Price to Sales (P/S)0.00

P/FCF Ratio1.66

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Route1 Inc Business Overview & Revenue Model

Company DescriptionRoute1 Inc. provides data security and user authentication, data acquisition and analytics, data visualization technology solutions in the United States and Canada. The company offers MobiKEY, a desktop secure remote access solution; DerivID, a credentials solution for PIV and CAC that validates the identity of mobile users; and MobiNET and DEFIMNET, which are universal identity management and service delivery platforms. It also provides ActionPLAN that captures and interprets the data in the form of actionable work orders to deliver real time and quantitative industrial process data and analytics to help pinpoint the exact sources of unplanned downtime; ScreenSTOP, an intelligent in-motion screen masking solution to reduce operator distraction for forklifts; and AutoVu, an automatic license plate recognition system to locate vehicles of interest and enforce parking restrictions. In addition, the company offers rugged devices, such as laptops and notebooks, tablets, handhelds and scanners, printers, vehicle docking stations and mounts, WiFi networks, mobile wireless, mobile antennas and wireless accessories, and mobile video and video accessories, as well as computing, printing and scanning accessories. It serves federal government, manufacturing, financial service, healthcare, manufacturing, parking, and public safety, as well as oil, gas, and utility industries. Route1 Inc. is headquartered in Toronto, Canada.

How the Company Makes MoneyRoute1 Inc generates revenue primarily through the sale of its security and data protection software solutions. Key revenue streams include licensing fees for its software products, subscription-based services for ongoing access to its secure data delivery platforms, and professional services such as consulting and implementation support. The company also forms strategic partnerships with other technology providers to expand its market reach and enhance its product offerings, contributing to its overall earnings.

Route1 Inc Financial Statement Overview

Summary

Route1 Inc. faces significant financial challenges with declining revenue, negative profit margins, and high leverage. While there are improvements in operating cash flow, the overall financial health is concerning due to negative equity and inconsistent free cash flow. Strategic realignment may be necessary to address these issues and stabilize financial performance.

Income Statement

Neutral

The company has experienced declining revenues from $29.7M in 2020 to $15.5M in TTM 2024, indicating significant revenue contraction. The net profit margin is negative, with a net loss of $1.04M in TTM 2024, reflecting ongoing profitability challenges. The EBIT and EBITDA margins are also negative or low, highlighting operational inefficiencies. However, there's a slight improvement in EBITDA margin from previous periods.

Balance Sheet

Negative

The company's balance sheet shows high leverage with a negative equity of $-211K in TTM 2024, indicating financial instability. The debt-to-equity ratio is unfavorable due to negative equity, increasing financial risk. The equity ratio has deteriorated over the years, showing a concerning trend in asset financing through debt.

Cash Flow

Neutral

Operating cash flow has improved to $984K in TTM 2024, but free cash flow remains volatile despite a recent increase. The operating cash flow to net income ratio is strong due to the net loss, but free cash flow growth is inconsistent. The company faces challenges in maintaining stable cash flow amidst declining revenues.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
15.52M	17.58M	22.05M	27.27M	29.71M	24.01M
	Gross Profit
4.83M	5.87M	7.58M	10.82M	11.07M	9.03M
	EBIT
-1.85M	-637.52K	-376.90K	593.39K	-16.78K	232.91K
	EBITDA
466.15K	542.08K	1.02M	1.80M	-224.72K	-14.23K
	Net Income Common Stockholders
-1.04M	-1.28M	-1.72M	222.21K	-1.71M	-554.18K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.34M	38.35K	78.50K	62.57K	1.14M	125.54K
	Total Assets
3.48M	9.54M	12.36M	15.10M	14.18M	12.63M
	Total Debt
834.72K	4.62M	4.99M	4.72M	4.09M	3.06M
	Net Debt
-500.91K	4.58M	4.91M	4.66M	2.95M	2.94M
	Total Liabilities
3.39M	8.96M	10.59M	12.37M	12.04M	11.65M
	Stockholders Equity
86.21K	584.35K	1.77M	2.73M	2.14M	979.73K
Cash Flow		Free Cash Flow
894.64K	218.88K	580.32K	353.39K	-226.36K	-371.26K
	Operating Cash Flow
984.62K	686.82K	602.27K	1.05M	256.27K	328.23K
	Investing Cash Flow
-88.22K	-467.94K	530.00	-2.20M	-458.06K	-1.80M
	Financing Cash Flow
-1.07M	-347.76K	-457.59K	5.50K	1.32M	621.95K

Route1 Inc Technical Analysis

Technical Analysis Sentiment

Positive

Last Price0.10

Price Trends

50DMA

0.06

Positive

100DMA

0.05

Positive

200DMA

0.04

Positive

Market Momentum

MACD

0.01

Negative

RSI

64.47

Neutral

STOCH

66.67

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ROI, the sentiment is Positive. The current price of 0.1 is above the 20-day moving average (MA) of 0.07, above the 50-day MA of 0.06, and above the 200-day MA of 0.04, indicating a bullish trend. The MACD of 0.01 indicates Negative momentum. The RSI at 64.47 is Neutral, neither overbought nor oversold. The STOCH value of 66.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ROI.

Route1 Inc Peers Comparison

Overall Rating

UnderperformOutperform

Sector (60)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	60 Neutral	$11.58B	10.33	-7.23%	2.94%	7.47%	-10.84%
ROI	47 Neutral	C$4.25M	―	-1057.89%	―	-13.79%	18.30%
ISFT	45 Neutral	C$3.36M	―	6.45%	―	8.58%	66.13%
ISGI	41 Neutral	C$3.41M	―	-356.98%	―	33.05%	73.39%
MBO	32 Underperform	C$2.55M	―	43.74%	―	-67.05%	-43.16%

* Technology Sector Average

Performance Comparison

TSE:ROI

Route1 Inc

0.10

0.04

66.67%

TSE:MBO

Mobio Technologies

0.06

-0.10

-62.50%

TSE:ISGI

InsuraGuest Technologies

0.02

0.00

0.00%

TSE:LQID

Liquid Avatar Technologies Inc

0.02

0.00

0.00%

TSE:ISFT

ICEsoft Technologies Canada Corp

0.03

-0.02

-40.00%

TSE:WHIP

Axiom Capital Advisors

0.06

-0.98

-94.23%

Route1 Inc Earnings Call Summary

Earnings Call Date:Apr 29, 2025

(Q4-2023)

% Change Since: 25.00%|

Next Earnings Date:May 15, 2025

Earnings Call Sentiment Neutral

Route1 has made significant progress in stabilizing its business model and growing its non-MobiKEY revenue streams. The company is optimistic about future EBITDA growth and financial stability. However, challenges remain, particularly with the decline in MobiKEY revenue and the impact of decreased VAR business. The sentiment is cautiously optimistic as Route1 continues to navigate its pivot to services.

Q4-2023 Updates

Positive Updates

Pivot to Services and Stabilization

Route1 has successfully pivoted from a pure play software cybersecurity company to an outcome-based services company, focusing on video capture-based technologies. The company reports stabilization in the fourth quarter of 2023, with a promising outlook for 2024.

Growth in Non-MobiKEY Business

The non-MobiKEY gross profit generation exceeded $150,000 in two of the last four quarters, indicating growth in professional services and support contracts.

Support Contracts Revenue Milestone

In Q1 2024, Route1 achieved more than $1 million in annualized revenue from support contracts, reflecting significant growth in the recurring revenue stream.

Improved Financial Metrics

Route1 anticipates exceeding $1 million in trailing four-quarter EBITDA by mid-2024, aiming for improved working capital and reduced third-party debt levels.

Negative Updates

Decline in MobiKEY Revenue

There was a loss of approximately $225,000 in quarterly subscriber revenue from MobiKEY, attributed to competition from Microsoft integrating similar services in their suite.

Impact of Decline in VAR Business

Revenue was negatively impacted by a $4.5 million decrease due to a reduction in value-added reseller business and MobiKEY subscriber base.

Debt and Working Capital Challenges

Despite stabilization efforts, Route1 continues to manage high debt levels and working capital challenges, with a focus on reducing these through 2024.

Company Guidance

During the Q4 2023 earnings call for Route1, CEO Tony Busseri discussed the company's strategic pivot from a pure play software cybersecurity firm to a comprehensive services provider, emphasizing their focus on delivering video capture-based technologies. He highlighted several key metrics, noting a decrease in revenue by approximately $4.5 million due to a reduction in value-added reseller business and MobiKEY subscriptions, which affected gross margins by around $700,000. Despite this, the company saw stability and growth in other areas, achieving non-MobiKEY gross profit above $150,000 per quarter in two of the last four quarters. Additionally, Route1's recurring license plate recognition technology support agreements exceeded $1 million on an annualized basis by Q1 2024. Busseri also underscored the importance of fixed cost control to enhance EBITDA and expressed optimism about achieving over $1 million in trailing four-quarter EBITDA by the end of the first half of 2024, while maintaining a stable debt position and improving working capital.

Route1 Inc Corporate Events

Business Operations and StrategyFinancial Disclosures

Route1 Inc. Reports Fiscal Year 2024 Financial Results

Negative

Apr 29, 2025

Route1 Inc. reported its financial results for the fiscal year ending December 31, 2024, showing a decline in total revenue to CAD 15.154 million from CAD 17.578 million in the previous year. The company faced a net loss of CAD 1.061 million, although it maintained a focus on cash flow stability and shareholder value. Despite the financial challenges, Route1 plans to update its operating metrics in May 2025 to reflect its growth strategy, aiming for improved returns and business scaling through acquisitions.

Spark’s Take on TSE:ROI Stock

According to Spark, TipRanks’ AI Analyst, TSE:ROI is a Neutral.

Route1 Inc. presents a mixed outlook with significant financial challenges characterized by declining revenue, negative profit margins, and high leverage. Despite these financial concerns, the stock’s technical indicators show short-term bullish momentum, although caution is warranted due to possible overbought conditions. Valuation metrics are unfavorable due to the company’s losses, underscoring the need for strategic improvements to enhance financial health and investor confidence.

To see Spark’s full report on TSE:ROI stock, click here.

Financial Disclosures

Route1 Inc. to Release Fiscal Year 2024 Financial Results

Neutral

Apr 25, 2025

Route1 Inc., a leader in advanced data capture-based technologies, announced it will release its fiscal year 2024 financial results on April 28, 2025. The company plans to hold a business update conference call and webcast in May 2025, details of which will be announced later. This announcement is part of Route1’s ongoing efforts to provide stakeholders with transparency and insights into its financial performance and strategic direction.

Spark’s Take on TSE:ROI Stock

According to Spark, TipRanks’ AI Analyst, TSE:ROI is a Neutral.

To see Spark’s full report on TSE:ROI stock, click here.

Product-Related AnnouncementsBusiness Operations and Strategy

Route1 Inc. Secures Major Orders and Expands Acquisition Strategy

Positive

Apr 10, 2025

Route1 Inc. has secured new purchase orders exceeding CAD $1,400,000 from two major cities in the southwestern United States for ruggedized devices, marking a strong start to 2025. These devices, essential for first responders, enhance situational awareness and operational efficiency. Additionally, Route1 is expanding its acquisition strategy to target the sales, installation, and service sector of first responder vehicle and equipment upfitters, aiming to strengthen its market position and drive growth in this fragmented sector.

Spark’s Take on TSE:ROI Stock

According to Spark, TipRanks’ AI Analyst, TSE:ROI is a Neutral.

To see Spark’s full report on TSE:ROI stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.