eResearch Corp. published an updated Research Report after Peak Positioning Technologies Inc. (CSE:PKK; OTCQB: PKKFF; DB:P0T) released its first fiscal quarter of 2020 financial statements. Peak is the parent company of a group of Fintech subsidiaries operating in China’s commercial lending industry.
Peak provides an investment vehicle for investors looking to participate in China’s Fintech industry. Peak’s subsidiaries use technology, analytics, and artificial intelligence to provide loans, help small and medium enterprises obtain loans, help lenders find clients, and also minimize lending risk.
In its first fiscal quarter of 2020, Peak’s revenue was C$3.9 million compared to C$0.9 million in the same period in 2019. Revenue in the first quarter was higher than eResearch's estimate of C$2.6 million, even with the Covid-19 pandemic impacting operations in China.
Peak's Fintech subsidiaries generated 70% of revenues in the quarter and its Financial Services subsidiaries generated 30% of revenues. Peak’s revenue benefited late in the quarter from the Company’s lending platforms being used to help distribute government relief funds to Small-to-Medium Enterprises (SME’s) that were affected by the coronavirus shutdowns.
Peak commented that it continues to believe the recently acquired Jinxiaoer platform is a catalyst for the expansion of its services throughout China. Closing in later 2019, the Jinxiaoer Platform technology integration was completed with Peak’s lending platform in May 2020 and eResearch expects the Jinxiaoer subsidiary to start contributing revenue in the second half of fiscal 2020, with the full-year revenue impact showing up in fiscal 2021.
eResearch expects Peak’s revenue growth to continue now that the health crisis has subsided in China, and therefore maintained its 2020 revenue estimate of C$35.3 million and increased its EBITDA estimate to C$5.6 million. eResearch also maintained its original "Buy" rating and one-year price target of $0.20.
In June, Peak announced that it had begun the process to have its shares listed for trading on the OTCQB stock exchange in the United States. Peak believes by upgrading the listing to the OTCQB from the OTC Market’s Pink exchange, the Company will gain access to a new pool of U.S. Investors.
Peak competes in China with other companies including Ant Financial, X Financial (NYSE: XYF), and Hexindai Inc. (NASDAQ: HX).
For more information about eResearch's report on Peak Positioning, please visit eResearch's website.
Disclaimer / No representations, express or implied, are made by eResearch as to the accuracy, completeness or correctness of its research. Opinions and estimates expressed in its research represent eResearch’s judgment as of the date of its reports, are subject to change without notice, and are provided in good faith and without legal responsibility. Its research is not an offer to sell or a solicitation to buy any securities. The securities discussed may not be eligible for sale in all jurisdictions. Neither eResearch, nor any person employed by eResearch, accepts any liability whatsoever for any direct or indirect loss resulting from any use of its research or the information it contains. eResearch reports may not be reproduced, distributed, or published without the express permission of eResearch. eResearch accepts advertising and other fees from companies, financial institutions, other third parties, and Institutional and Retail Investors. The purpose of this policy is to defray the cost of researching small and medium capitalization stocks which otherwise receive little or no research coverage. To ensure complete independence and editorial control over its research reports, eResearch follows the CFA Institute’s “Best Practice Guidelines Governing Analyst/Corporate Issuer Relations”.
