2020's Best Turnaround Stock Could Follow in Amazon, Netflix & Tesla's Footsteps By Luke Lango and the InvestorPlace Research Staff Often times, the best stocks in the world have humble beginnings. And that's really just a nice of way saying that many of today's greatest stocks were, at one point in time, considered losers on Wall Street. Netflix—the $215 billion streaming service which, today, is ubiquitous across the U.S. —was once a penny stock that almost went bankrupt… Amazon—the $1.5 trillion king of global online retail and cloud computing—was once a beaten-up stock licking its wounds from the Dot Com Bubble bursting… Not too long ago, Tesla—the $280 billion electric vehicle pioneer—saw its stock price collapse 50% as many on Wall Street said the company was never going to strike a profit… In other words, many of today's shining stars on Wall Street, started off as turnaround stories. They went from being on the verge of dying, to taking over the world. In today's edition of The Daily 10X, we are going to tell you about one of the most exciting turnaround stories unfolding in the market right now. It involves a dying media company that has surged back to life in 2020, and which has an opportunity to deliver Netflix-, Amazon-, and Tesla-like returns over the next few years. An OTT-Inspired Turnaround Story with HUGE Long-Term Potential I don't blame anyone for taking one look at the stock chart for Cinedigm (CIDM), and writing off the $160 million entertainment company as a long-term loser. After all, coming into 2020, Cinedigm stock had lost 98% of its value from its 2014 peak. But the growth narrative surrounding Cinedigm has entirely changed in 2020. For the better. And Cinedigm stock has surged higher this year on heavy volume. Broadly, Cinedigm has historically focused on distributing independent content assets through the linear television and movie theater channels. But those wells have been drying up for several years now, as consumers have abandoned cable TV and movie theaters in favor of streaming platforms. So, in 2019, Cinedigm management made a huge bet: They decided to put all their eggs in the over-the-top (OTT) basket, and spend all their time and resources turning the company's content library—which includes over 32,000 movies and TV shows—into a portfolio of streaming channels. That bet was a genius one—and it's paid off in a big way in 2020. Cinedigm's newly launched streaming channels—including Comedy Dynamics (which features stand-up comedy specials), Docurama (independent documentaries), CONtv (Comic-Con content), The Bob Ross Channel (yes, it's a channel dedicated to the legendary landscape painter by the same name), and more—have dramatically expanded their distribution across the OTT landscape in 2020. Specifically, in January, Comedy Dynamics landed on Samsung TVs, which is a big deal since Samsung is the number one TV maker in North America. In late May, multiple Cinedigm streaming channels—including Comedy Dynamics, CONtv, and Docurama—landed on Amazon's IMDB TV. A few weeks later, in early June, many of those same Cinedigm channels scored distribution through Vewd, the world's largest Smart TV OTT software provider, with an install base of more than 300 million Samsung, Sony, Philips and TiVo TVs. In other words, in 2020, Cinedigm's portfolio of niche streaming channels have gone from being available nowhere, to being available everywhere… with management estimating that Cinedigm's content is now accessible to nearly 700 million households worldwide. But is anyone watching this content? Yes. Cinedigm exited 2019 with 5.6 million OTT viewers. That number rose by 73% to 9.7 million viewers in March. It rose another 36% to 13.2 million viewers in May. Management is guiding for another 100% growth in viewers over the next 18 months. And the growth won't stop there. Sure, Cinedigm's streaming channels are niche. But those niches are bigger than you think. Around 2 to 3 billion people globally watch anime content. Bob Ross' YouTube videos often have 5+ million views. 75 million households watched a stand-up comedy special on Netflix in 2019. 64 million watched the Tiger King documentary alone. There is, unequivocally, ample viewing demand for animated content, documentaries, stand-up comedy and… yes… Bob Ross, too. Thanks to broad distribution agreements, Cinedigm now has a visible and compelling opportunity to capitalize on that significant demand in the growing OTT channel over the next several years. At the same time, the $71 billion spent on linear TV ads last year, will increasingly chase eyeballs and migrate into the OTT channel. That's a big deal for Cinedigm, because its streaming channels are mostly ad-supported. Thus, not only will Cinedigm's viewer base swell over the next few years, but so will the amount of ad revenue the company collects from each viewer. To that end, it's easy to see how this turnaround story could ramp… very quickly… as viewers go up… ARPU goes up… revenues go up… and the stock explodes higher. Needless to say, this is one of the market's most exciting turnaround stocks. Considering many of today's shining stars on Wall Street started off as exciting turnaround stories, Cinedigm stock is worth your attention. Today. | Key Company Details | | Company Name | Cinedigm Corp. | | Ticker Symbol | CIDM | | Share Price | $1.67 | | Current Market Value | $160 Million | | Annual Revenue | $39 Million | | Catalyst | Streaming Media Turnaround Story |
Today's Investor Education Focus: | | | The Wall Street Journal will never run a front page story about it… And it won't get featured on CNBC. But one of the world's most powerful investment strategies comes down to investing in habits. This is not a widely discussed idea. But boy is it powerful… | Click here to visit The Daily 10X Stock Report Education Center
and access our library of our educational resources
New to The Daily 10X Stock Report?
Click here to access our Quick Start Guide | 
Comments
Post a Comment