Same asset, new use: management describes redeploying something the company already owns into a materially higher-value
The model's full reasoning — Q4 2017 call → NOWe need to determine if management describes a current repurposing of an existing asset to a materially more valuable use, already in motion. The transcript discusses many things: growth, acquisitions, tax reform, investments. But the key is a change of purpose for something already in hand, with better economics, already happening. Look for examples: OptumCare expansion, DaVita acquisition (new), Banmedica (new), The Advisory Board (new). Those are acquisitions, not repurposing existing assets. What about existing platforms? For example, Rally: "We doubled the number of people with Rally IDs in 2017, now more than 15 million, while administrating more than $400 million in consumer incentives. Market interest for this type of scale tested solution is growing. A large local health plan selected Rally as its consumer technology platform and several renowned hospitals are now using Rally for everything from searching for a physician to pricing the appointment and appointment schedule." That sounds like Rally was originally a consumer engagement platform, now being used by health plans and hospitals as a technology platform. That is a change of purpose? Possibly. But is it materially more valuable? Not explicitly stated. PreCheck MyScript: "We launched PreCheck MyScript connecting patients, physicians and health firms with useful information at the point of prescribing, right in the physician’s workflow. PreCheck MyScript has already being used by tens of thousands of prescribers for nearly 1.5 million transactions. We will offer it to all OptumRx members expecting to reach 80% of active prescribers by the end of 2019." That's a new product launch, not repurposing existing. What about the data analytics capabilities? "We unified our unique data science and analytics capabilities under the OptumRx brand." That's a rebranding, not a change of purpose. The question is about a specific phenomenon: an existing thing inside the company being pointed at a new purpose that management says is worth considerably more per unit. The transcript doesn't seem to have that. Management talks about growth, acquisitions, investments, but not about taking an existing asset and repurposing it for a more valuable use. For example, they talk about expanding into new markets, but that's growth.
| Ticker | Company | Call | Date | Call grade |
|---|---|---|---|---|
| SANG | Sangoma Technologies Corporation | Q2 2024 | 2024-02-08 | D |
| APPS | Digital Turbine, Inc. | Q1 2024 | 2023-08-08 | D |
| PRPH | ProPhase Labs, Inc. | Q1 2023 | 2023-05-11 | F |
| GGR | Gogoro Inc. | Q1 2023 | 2023-05-11 | D |
APPS · Q1 2024 → YESThe question is whether management describes currently putting something they already own or do to a different and materially more valuable use, and that this is already happening now. YES Bill Stone describes using the company’s existing on-device technology and installed base of hundreds of millions of devices (already owned and paid for) for a new purpose: alternative app distribution via DT Hub and SingleTap monetization. He states they have launched DT Hub with four U.S. operators and are generating revenue today with incremental higher RPDs from devices engaging with the Hub product, and they are leveraging existing hub capabilities to enable direct distribution outside Apple/Google stores. This is presented as already happening now, with the new use delivering better economics through higher RPD accretion and expanded revenue streams.
PRPH · Q1 2023 → YESThe question is whether management describes currently putting something they already own or do to a different and materially more valuable use, and that this change is already happening now. YES The transcript shows management describing a clear redirection of assets already owned: the manufacturing facility (originally kept solely for Cold-EEZE infrastructure after the brand sale) is now being run for third-party lozenge manufacturing, with revenues growing nearly 100% year-over-year and $25 million targeted for 2024 — a use they explicitly call “the least interesting business” yet one with “enormous value” and an estimated $70 million next-year market value.
GGR · Q1 2023 → YESThe question is about whether Gogoro is currently putting something it already owns or does to a different and materially more valuable use. YES The transcript shows Gogoro is already redirecting its existing battery-swapping network and smart batteries (originally built for vehicle swaps) into a new Virtual Power Plant use case via the Enel X partnership.