Good Morning, Trader!
Digital Caddies Inc. (CADY) is built around one of those business brainstorms that I wish I thought up first and traders are embracing now.
CADY wires golf courses with custom data about the weather, hazard layout, advice and everything a genius caddy can provide. (See how it works)
Golfers access the “assistance” via a tablet mounted on the golf cart -- instead of tipping, they watch commercials on the CADY ad network!
The revenue story here has already brought private equity funds sniffing around, and you can see for yourself what it’s done to the CADY chart:
In just the last 2 days CADY surged from below the 50-day trend to challenging the 200-day line! What’s got these shares so roiled up?
Turns out CADY just signed a deal with mighty Google’s ad network, which you old-school dot-com guys might remember as DoubleClick. (Read more)
That headline alone was worth a 50% rally on Thursday, and while prices “consolidated” on Friday, the technical situation looks refreshed.
Check out how the MACD jumped above signal to demonstrate how much upside momentum CADY has now! And the RSI is now defiantly bullish!
Evidently having Google in the clubhouse is what CADY watchers had been waiting for, making some traders bold enough to grab shares at $0.27.
Fact is, the ads were the last piece of the puzzle CADY had to fill in. They already had dozens of high-end courses hooked up. (Read more)
Country clubs love CADY because the screens find lost players, cut service costs and differentiate them from other high-end resorts. (Read more)
Players love being able to order “refreshments” right from the links and have their scores electronically recorded and analyzed. (Read more)
The carts are already wired with a combination of Samsung hardware, Sprint broadband and CADY systems. (Read more)
Even before the Google deal, CADY was running 100 MILLION ads a month -- and that was in February, well before the start of golf season! (Read more)
Last summer CADY revenue TRIPLED from previous record levels and even generated a small operating profit.
That was before deal after deal after deal after deal opened dozens of courses to CADY’s system and bring new golfer eyeballs to the advertisers.
Having Google manage the ads can only accelerate “monetizing” those eyeballs. No wonder investment banks are nibbling on CADY now!
Here’s one that just spent $5 million for a slice of what is currently barely a $14 million operation!
Now I’m not going to drone about relative multiples in the mobile advertising market to say what CADY “should” be worth.
Facebook users are very different from Twitterers and golfers are known for being a rich and hard-to-reach target audience.
Either way, CADY is a unique niche play just coming into its peak season as courses open up beyond Florida and Arizona’s eternal tropical zone.
Given the way the chart has been flipping old resistance lines, it looks like other traders are recognizing the fresh air CADY brings to the table.
We’re already at tee-off time, so let’s see how CADY slices today!
See you soon!
- Papa Roach
