Room to raise the ceiling: management says its own prices, rates, or terms sit below what the market would currently bea
The model's full reasoning — Q4 2021 call → NOWe need to determine if management conveys that the company is currently charging less than what the market would bear, and that they are actively closing that gap. Look for statements about pricing, undercharging, raising prices, resetting contracts, etc. Scan the transcript: Management talks about growth, customer adoption, utilization, new products, partnerships, biopharma. They mention "land and expand" strategy, increasing utilization, new offerings. They discuss HRD, CarePath, etc. They talk about revenue growth, net dollar retention, churn, LTV/CAC. They mention "average revenue per platform customer" increased from $70k to $92k. That's an increase in revenue per customer, but is that due to pricing or mix? They say "increased usage rates across our existing customers" and "new customers added". So revenue per customer increase is due to more usage, not necessarily price increase. They mention "ASP" in response to a question about "ASP per customer" - Ross says "on the ASP side, obviously, we've had now, for many years, a very favorable trend. I would say, consistently, it should be certainly apples-to-apples in that mid-single or low to mid-single range." That's about ASP growth, but not necessarily about undercharging. They talk about "value share" going up, but not about charging below market. They mention "we are seeing more and more traction" with reference labs, and "we expect to be signing much more of this type of contracts" - but no mention of pricing being below value. They talk about "HRD" and "PARP inhibitors" and "demand" but not about pricing. They mention "we are very careful about cash management" and "LTV to CAC" but not about pricing. They mention "we are relatively conservative" in guidance. No explicit statement about charging less than market value. No mention of raising prices, resetting contracts, undercharging, etc. The only thing close is "average revenue per platform customer" increased, but that's due to usage, not price. Also "ASP" trend is favorable, but that's not a claim of undercharging. Thus, answer NO.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
| MEC | Mayville Engineering Company, Inc. | Q3 2022 | 2022-11-05 | B+ |
| CAG | Conagra Brands, Inc. | Q2 2017 | 2016-12-22 | C+ |
| SOHO | Sotherly Hotels Inc. | Q3 2016 | 2016-11-08 | D |
| RCL | Royal Caribbean Cruises Ltd. | Q1 2016 | 2016-04-29 | C+ |
| HPP | Hudson Pacific Properties, Inc. | Q4 2015 | 2016-02-25 | C |
HPP · Q4 2015 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices, rates, fees, or terms sit meaningfully...YES The transcript shows management explicitly describing a gap between its current charges and what the market now supports, then confirming that the company is already closing it through mark-to-market resets and higher new/renewal rents. Victor Coleman states that the company has “rolled out 80% plus mark to market” on recent leases 2.5 years old, and that cash rent spreads on 1.6 million square feet executed since the acquisition were “north of 30%” with “20%, 25% mark-to-market for 2016 and 2017.
MEC · Q3 2022 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices sit meaningfully below the value custom...YES Management explicitly states that they have taken pricing actions in 2022 and have "more room for margin expansion through continued value pricing even beyond the pricing actions taken during 2022." This conveys that their current prices sit below what the market would support, and they are actively beginning to close that gap with further value pricing.
SOHO · Q3 2016 → YESThe question is: Does management convey that the company is currently charging LESS for what it sells than the market would presently bear — that its own prices, rates, fees, or terms sit meaningfully...YES The transcript shows management explicitly identifying a rate gap at the Laurel hotel (and similar situations at other properties) where current charges sit below the competitive set/market, while describing active steps already underway to close that gap through continued ramp-up and occupancy/rate improvements.