July 17, 2020 -- InvestorsHub NewsWire -- via Seeking Alpha

 

Jul. 16, 2020 6:00 PM ET|About: Data443 Risk Mitigation, Inc. (ATDS), Includes: ADBE, CHKP, CRWD, FB, FTNT


 

  • Hottest video app ZOOM (ZM: NASDAQ) signs up and now offering ATDS Cyber Security. ZOOM Puts ATDS link at top of first page
  • First NFL team, Miami Dolphins, signs up for ATDS because it is the safest security app available. Wave of other teams expected to follow as well as other major league teams
  • New Data Privacy laws such as the EU GDPR and California CCPA are fueling unprecedented demand for Cyber Security and COVID-19 driven remote work is further fueling demand
  • Open Source software model is “free” and has been enormous growth driver in countless successful software enterprises such as YouTube, RHAT, FB, TWTR, GOOG, NFLX, MSFT, ADBE, ORCL
  • ATDS now on over 30,000 web sites with a reach to millions of end users
  • Sales increased from zero in 2018 to over $1.4 million in 2019, and estimated 2020 sales projected at over $5 million. First quarter 2020 was $477,877 versus $142,971 for same period 2019. Exponential growth!
  • ATDS shares have been EXTREMELY OVERSOLD down from $1.90 in last 12 months by convertible note holders whose only goal was to liquidate at any price and with no regard to share price. The company has now struck a deal to halt the aggressive selling
  • BioResearchAlert finds ATDS shares undiscovered and undervalued with current market cap of only $1.8 million and share price of 2 cents. Current market comps point to current ATDS share value over $.40 per share and significantly higher as current growth rate continues to accelerate

Summary

Data443 Rik Mitigation (ATDS: OTC) is a solid and fast-growing cyber security company that has seen its shares falling from $1.09 in the past 12 months to 1 cent within the past week. The company has been growing, but convertible note holders have been liquidating without regard to price and have consequently created an extremely undervalued opportunity for investors.

Recently, ATDS has announced major news that has attracted substantial buying resulting in share price reversing and rising to over 2 cents with projections and target exceeding 40 cents for the near term and substantially higher in coming months and years.

ZOOM (ZM: NASDAQ) is the most popular and fastest growing video conferencing app leaving all others in the dust and has seen its shares fly from $76 per share earlier this year to over $260 per share this week.

ATDS traded 59 million shares yesterday just beginning what appears to be a major reversal and breakout to a target of 40 cents seeking fair market valuations based on actual industry comps.

Countless examples point to the enormous success of the “open source” model for software apps where apps offered to users for free have the potential to mushroom the number of users in a short time and create value from additional offerings such as premium upgrades or ad-free services. Examples are numerous and include well-known names such as YouTube, RHAT, FB, TWTR, GOOG, NFLX, MSFT, ADBE, ORCL. Each has their own unique product, but “open source” or “free” apps is one of the primary drivers of huge growth.

Data443 Risk Mitigation (OTCPK: ATDS) is the first to combine the growing need for new Data Privacy with free “open source” solutions to attract a large number of users. Underlying value to investors and to potential suitors increases as the number of users grows, even if they are free. WordPress powers over 1,000,000,000 websites globally and operates its own app store like Apple and Google. In 2016, 1.5 Billion plugins were downloaded from the WordPress.org repository alone.

Data443 has seen active users of its GDPR Framework for WordPress go from less than 5,000 to over 30,000 in less than 1 year! ZOOM now offers DATA443 and the Miami Dolphins adoption opens the door to the entire NFL and other sports leagues. The Company expects to continue to expand its open source overrings significantly this year.

The following February 23, 2020 article explains the undervalued share price and the current market comps indicating substantially higher valuations with the potential for unusually large gains:

Market comparisons based on actual sales demonstrate that ATDS shares are exceptionally undervalued and when share prices catch up with the market through investors becoming aware of this disparity, the price has the potential to increase over 6,000% from current levels.

With the recent increase in sales and projected strong growth from new laws requiring the services of ATDS, and with the drastic reduction in the number of shares reduced from 9.5 billion to about 153 million, it appears that the stage is now set for ATDS to achieve higher prices that have the potential to challenge and even set new highs for 2020 and 2021.

Goldman Small Cap Research published bullish report on ATDS.

Enviable Corporate Success Has Been Overlooked

"ATDS offers what is the longest running DRM platform for mobile. Moreover, in its open source solution, ATDS boasts over 30,000 users---this number rivals and exceeds some of the largest and leading companies in the space. Clearly, many are ripe for conversion to paying customers and thousands are trusted relationships---a highly valuable and hidden asset. New cloud-based, multi-functional and integrated offerings are slated to be introduced following a series of customer tests. This new integrated platform could generate $1500/mo/per customer seeking comprehensive data and privacy solutions," commented Goldman.

ATDS Represents an M&A Prospect

Goldman concludes, "Revenue could approach $1.8M for 2019 and possibly $5M in 2020-the first full year that its three acquisitions will generate revenue and organic growth is demonstrated. This excludes potential 2H20 M&A. Based on these forecasts, ATDS is undervalued relative to current prices and its peer group on a pre-revenue basis. Furthermore, once additional M&A is executed, these figures will likely have to be revised upward. In the meantime, ATDS could be viewed as an attractive takeover candidate. It has a large open- source user base, broad customer base, and low relative industry valuation. An acquirer could buy ATDS and grab tech and market share for a fraction of the industry's valuations. Thus, opportunistic investors may view prices represent an attractive entry point."

Current Market Comps – Price to Sales Ratio Based on Last 12 Month Sales

Splunk - SPLK 6.75 to 1

CheckPoint – CHKP 8 to 1

CrowdStrike – CRWD 25.5 to 1

OKTA – OKTA 25 to 1

Fortinet – FTNT 8 to 1

Zscaler – ZS 23 to 1

ProofPoint – PFPT 6.3 to 1

Average Price to sales Ratio = 11.8

Current ATDS market cap is $1,530,000 with share price of $.01. Based on reported 2019 revenues of $1.4 million and projected 2020 sales of $5 million, with current Price to Sales ratio of 11.8 to 1, ATDS shares are projected to trade at $.40 in 2020.

Business Highlights for the Third Quarter of 2019:

ATDS Expands Sales

During Q1-2020 Data443 has onboarded 9 new sales and marketing professionals and has a continuous growing inbound funnel of professional and capable staff team members going through the application and assessment process at the company. “During hiring, we look for many things – in addition to the basics of course - attitude, the ability to respond to and execute change and quickly cycle between product lines are major considerations for anyone joining our team. Our methodology is being applied across all of our product lines, so the expectations and requirements apply to those as well.”, added Mr. Bruni.

The recently announced Global Privacy Manager™ by Data443 product is built on the award winning data classification platform ClassiDocs™ and Data443’s WordPress GDPR Framework, which is currently powering more than 30,000 businesses worldwide for the EU’s GDPR Privacy Law will be rolled out immediately. The combined platform automatically searches the data residing in cloud application, databases, servers, and endpoints used by businesses to discover, classify and map customer data.

“The new sales and marketing methodology are already garnering results for the organization and we are excited to expand the program to the other product lines. This approach enables us to be more responsive and dynamic to changing market and customer demands – while managing costs and investment in direct to our financial models. This highly algorithmic approach is more appropriate for our business and today’s market conditions – giving us more accurate and timely information on the return of our efforts. These provide the foundation for our next evolution of the product line into consumer-facing capabilities which will be marketed directly and with partners to be announced at a later time.” said Remillard.

Fresh Comp

One quick look at a recent $210 million funding for $2.7 billion Cyber Security company called OneTrust further supports ATDA undervaluation and 2 tables illustrate the advantages held by ATDS over OneTrust.
 


ZOOM now offers DATA443 solutions to all of its users and lists DATA443 at top of first page:
 

 

Cloud-Based Data Storage, Protection, and Workflow Automation Platform

Personal and Corporate Privacy and Compliance Scanner for Group Video and WebinarsExposes Data443 Brand and Product Line to Millions of New Potential Clients

RESEARCH TRIANGLE PARK, NORTH CAROLINA, July 14, 2020 (GLOBE NEWSWIRE) -- Data443 Risk Mitigation, Inc. (“Data443” or the “Company”) (OTCPK: ATDS), a leading data security and privacy software company, today released to the general public its latest advance in its cloud Global Privacy Manager product line – Data443 Chat History Scanner - powered by the Company’s award winning ClassiDocs™.

What it is:

  • Effortlessly scan your recorded chat history logs for privacy, financial, security and other sensitive information types
  • Test different languages and sensitive data types against recordings to detect anomalies
  • Detect policy breaches by your staff or other vendors on webinars or group meetings
  • Remove recordings, webinars or other content that violates policy
  • Available for free to all subscribers; premium version to follow at reasonable cost

Why it matters:

  • Online meeting platforms have exploded in popularity during the recent pandemic, with significant room to grow.
  • Roughly two-thirds of U.S. workers who have been working from home prefer to continue working remotely as much as possible even when pandemic restrictions lift, according to a recent Gallup poll.1
  • Exposes Data443 brand and all other products to millions of end users and customers
  • Leading charge in the burgeoning online data storage and management space, providing the Company with significant market penetration

1 https://www.wsj.com/articles/seven-rules-of-zoom-meeting-etiquette-from-the-pros-11594551601?mod=searchresults&page=1&pos=2

Management Commentary:

Jason Remillard, CEO of Data443, commented, “Today’s announcement is another key accomplishment for Data443, and continues the development of our Global Privacy Manager product segment that includes a plethora of products that ensure corporate compliance and personal privacy online – for both consumers and businesses alike. This effort has taken months of work by our dedicated engineering staff, securing certification from the vendor, and enabling us to deliver another world-first product to the marketplace.”

“The combination of compliance requirements, massive data collection and storage of both consumer and commercial information, without the ability to scan, parse and understand this data in a massively growing virtual environment, continues to be a significant risk for organizations of any size. By creating the Data443 Chat History Scanner, we saw a “blue ocean” opportunity in creating a simple, quick and easy way to meet these challenges, while aligning Data443 with the global leader in online video communications.

“Being on the first page of security and compliance products in the App Store is another notch in our belt as we continue to deliver products for a wide range of SaaS information providers on many platforms. Being distributed and available on multiple providers is part of our new approach to expand our business and reach new potential customers,” concluded Mr. Remillard

Conclusion

Data 443 is ranked in the top 15 U.S. based Cyber Security companies by Black Book Market Research and provides services to big name clients like Hewlett Packard, Ripple, MicroSoft, Twitter, Facebook and Linkedin. Sales started at zero and were $1.4 million for 2019 and projected to hit $5 million in 2020. With an aggressive and smart acquisition program adding to sales and with strong organic internal sales growth, ATDS is expected to achieve strong sales growth and become a takeover target for the cash rich, sales hungry, software giants. There are about 153 million shares outstanding and the potential exists for prices at many multiples of today’s price and possibly even record highs in 2021. Displaying a strong vote of confidence, CEO, Jason Remillard, stepped up and negotiated a deal with convertible debt holders amounting to around $4 million that has now been extended between 6 months and one year and thereby eliminates those potential shares from ever hitting the market.

2019 revenues were driven by sales for 6 months from only one product and only 1 quarter of the second product, while 2020 sales are being driven by the ENTIRE YEAR OF SALES FROM ALL 3 PRODUCTS PLUS ACQUISITIONS.

Goldman Research recently rated ATDS as a Speculative Buy with a price target of $3.65.

With current market Sales to Price ratio of 11.8 to 1, if ATDS executes as they are currently doing and delivers 2020 sales of $5 million, it is reasonable to expect ATDS share price to achieve $.40 in 2020 and as growth accelerates share price has the potential to rapidly increase over $1.00. Recent adoption by ZOOM and the NFL confirms projections of rapid high growth.

Legal Disclaimer:

Except for the historical information presented herein, matters discussed in this release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. The Information contains forward-looking statements, i.e. statements or discussions that constitute predictions, expectations, beliefs, plans, estimates, or projections as indicated by such words as ''expects,'' ''will,'' ''anticipates,'' and ''estimates''; therefore, you should proceed with extreme caution in relying upon such statements and conduct a full investigation of the Information and the Profiled Issuer as well as any such forward-looking statements.

 

SOURCE: Seeking Alpha

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