Acceleware (TSXV:AXE) is a Canadian based technology company, headquartered in Calgary, Alberta. I have written about this company before, but for the benefit of any who may not be familiar with Acceleware, let me briefly recap who they are and what they do.
Acceleware provides High Performance Computing software solutions to the Oil & Gas and Computer Engineering markets for multi-core CPUs and compute GPUs. Additionally, our HPC consulting services are utilized by enterprises needing to harness the power of parallel computing. At Acceleware the goal is always the same – Go Faster!
Acceleware develops and markets software acceleration products that bring unparalleled performance and speed to today's most strenuous and challenging compute and/or data-intensive demands. With Acceleware solutions installed, computer processing for data processing and simulation applications can benefit from speed-ups of 10x to 50x. Acceleware also uses its unique expertise for providing consulting services for companies, and research institutions involved with High Performance Computing. These services include architecting multi-core processing solutions, code porting and training.
Acceleware has been faced with some of the toughest financial conditions over the last few years, as have basically all companies, but Acceleware has managed to remain very focused on what they want to achieve as a company. Acceleware has experienced a $3M strategic investment by NVIDIA® Corporation in 2007. In 2008, Acceleware was reportedly considered a global leader in GPU Computing, and continues to maintain this position. In 2009, Acceleware delivered TTI Reverse Time Migration targeted at offshore seismic processing. This was followed in 2010 by the announcement of a partnership agreement between the company and Paradigm, http://www.acceleware.com/press_release/acceleware-announces-partnership-paradigm , and also with a further announcement of another partnership agreement with Crosslight, http://www.acceleware.com/acceleware-delivers-100x-speed-solar-cell-simulations .
There was one other change made to Acceleware, which has proven to be a positive one in my opinion, and that was in September of 2010, http://www.acceleware.com/press_release/acceleware-announces-appointment-geoff-clark-ceo
The entire management team at Acceleware seems to work very much from the team spirit point of view, and in my opinion, this is noticeable from the fact that each has their specific part or duty to carry out, but they also rely heavily on each other as one would expect in a team setting.
During and since the restructuring of the company in the earlier part of this year, CEO Geoff Clark, had stated that he wanted to see the money, that Acceleware would come away from the restructuring with, spent heavily into the areas of attracting new customers, continuing to build sales with current customers, and to advance the company's profile in the investment world. To accomplish all of these goals is an ambitious undertaking. It would seem that Geoff has succeeded for the most part, although many retail investors have some degree of restlessness at how inactive the share price movement has been, and this of course is completely understandable. I have contacted Acceleware and approached these issues, which has left me of the opinion, that Geoff has, and is currently, attempting to build upon sales which should bring the company into a profit making position. Once Acceleware can show that they have turned from a restructured position to a position where they are making a profit, and to have this happen as quickly as possible, then it will become much more effective when management decides to start releasing more news regarding the company, which of course would be more pointed toward the institutional investment community. I cannot claim that this was stated in as many words, but this is my opinion and interpretation of my conversations with Acceleware management. I will add that if this is indeed the true course they are taking, I can see both the risk and the tremendous potential, and the potential in my opinion is significant. If Acceleware did not have the amount of contacts that they have in this industry, or if they lacked in interest in the technology they are attempting to sell, then I would view their current approach as a very negative approach. Being that this is not the case for Acceleware, I view the path they have chosen as quite possibly one that will help to bring Acceleware along the road to a dramatic increase in terms of shareholder value. I must also state that this is not a company that I view as ideal from a trading standpoint, or at least not currently, but I do remain very optimistic that this is a company that has the potential to be a game changer.
Many investors will be waiting for the financial report which is due approximately towards the end of November. I would fully expect that this should be a pleasant surprise as opposed to a disappointment, and this view is based on several points, which include the news releases of the many training sessions being offered. In April, Acceleware released news of the continuing effort in conjunction with Microsoft to offer classes in CUDA training, http://www.acceleware.com/press_release/microsoft-and-acceleware-announce-spring-cuda-training-schedule-gpu-programmers
This was followed by another announcement in May, in which Acceleware has collaborated with AMD to offer OpenCL education, http://www.acceleware.com/press_release/amd-and-acceleware-collaborate-offer-opencl-education
These training offerings are quite positive for Acceleware, not only from a financial standpoint, but also from profile standpoint within the industry. These training classes allow AccelewareAMD, will have long-lasting positive results for Acceleware in my opinion. Of course, Acceleware has also had several other very positive things that should help improve the financial report, such as the news release from July, in which the company announced the successful completion of a professional services engagement with MicroSeismic, Inc., a leading geophysical services company providing 3-D passive seismic imaging for energy exploration and production, to optimize their fracturing / fault prediction code for GPUs. Through this engagement, MicroSeismic can leverage the full computing capacity of GPUs to deliver higher resolution images sooner to their customers. http://www.acceleware.com/press_release/acceleware-delivers-performance-microseismic%E2%80%99s-software-yielding-faster-higher-resolut
To further re-enforce my view that Acceleware has positioned themselves in such a way, so as to allow the institutional investment community to view them as a company, which offers a very valuable service and one which also possesses a proprietary technology with outstanding value and future potential, we can look at most of the remaining news releases of this year until now. When Paradigm chose to work with Acceleware, I do not believe that many people understood just how important this could prove to be for Acceleware. The product that they worked on will undoubtedly come to be known as a vital ingredient in many oil and gas explorers as they continually attempt to find new reserves in ever-increasingly difficult geologies. This is what made news like the August announcement, of Fugro selecting the Paradigm Reverse Time Migration to meet its challenging depth imaging objectives, so significant. http://www.acceleware.com/press_release/fugro-selects-paradigm-and-acceleware%E2%80%99s-reverse-time-migration
With Paradigm being a company that has a stature which is recognized on a global basis, as is Fugro, this will help Acceleware gain recognition as a technology leader, due to their ability to produce a product which is capable of delivering dramatically positive results. Financially this will equate itself onto Acceleware's bottom line because of the licensing agreement covering the proprietary knowledge which Acceleware uses in producing these products.
In September, Acceleware made an announcement that they had partnered with Bull SAS to deliver a combined solution of Bull Extreme Computing platforms and Acceleware’s multi-core accelerated seismic solutions to customers in the EMEA Oil & Gas markets. The partnership will provide Bull customers streamlined access to Acceleware GPU software, multi-core consulting services and training offerings. http://www.acceleware.com/press_release/bull-and-acceleware-announce-partnership-deliver-unified-hardware-software-experience
Since Bull is largely regarded as one of Europe's best IT companies, it is with little difficulty that one can see this is a very strategic partnership. Again we see Acceleware profiting from several aspects. First, they have established a new business relationship, and they have managed to do this with none other than a leading company in this sector, but the fact that this has given them a nice entrance into the European space is of course very desirable. Add to this the fact that there will undoubtedly be a cash flow from licensing and educational points and I believe most people would have to agree, Geoff has positioned Acceleware very nicely up to now. I would expect that as Acceleware starts to move into positive financial ground, which I expect we will hear this reporting period, we could expect that management will begin to bring Acceleware more into the view of the larger investors, and I believe this will help optimize the efforts of management in this respect.
In speaking with management recently, I was told that the major release of TTI AxRTM at SEG in San Antonio, Texas, was met with significant interest, so we can potentially expect more news to originate from this hopefully. Another event that will prove to be quite important is the upcoming Supercomputing conference. This conference is considered to be the premiere international event for all things concerning high performance computing (HPC), networking, storage and analysis. The dates for this event are Nov. 12 - 18, 2011, and will be held in Seattle, Washington. Another event that I was made aware of, is an event which Acceleware has been invited to in China, and which Geoff stated he will be presenting at. It is my understanding that this event will be well attended by many of the companies which could potentially profit from the use of Acceleware's technology. These types of invitations tend to lend credence to the belief that Acceleware has already been accepted into the Asian technology sector, and now may begin to see some further expansion into this area. Geoff also stated that he would like to make a stop at the regional Paradigm office while he was over there.
To quickly recap the activities of Acceleware and comment on where I see the company progressing from here, I would admit that management has made decisions somewhat differently than what I had originally anticipated, but I must also admit that their strategy is becoming much clearer at this point. After watching how the company has vigorously pursued attracting both new business, expanding present affiliations in both the service and sales of their technologies, and comparing this with how the company's financial condition has steadily improved, I would expect some very positive things looking forward. In my opinion management has done a wonderful job of positioning Acceleware in such a way that once they have proven they have what it takes to be profitable we can fully expect they will begin attempting to bring the company into view of the large investment facilities. From that point I would expect that Acceleware will definitely progress to a much higher market cap.
If this has made Acceleware seem like a possible investment choice, I would strongly urge everyone to do their own due diligence. A perfect place to start would be at the company website which can be found at http://www.acceleware.com/. All opinions stated in this article are my own.
For disclosure purposes I have received no compensation of any kind for this post or my opinions. I do own shares in Acceleware.
Thanks Brujacman,
ReplyDeleteI always appreciate your input!