NasdaqCM:NETE

Stock Analysis Report

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Executive Summary

Net Element, Inc. operates as a financial technology and value-added solutions company in North America, Russia, and the Commonwealth of Independent States.


Snowflake Analysis

Overvalued with weak fundamentals.

Share Price & News

How has Net Element's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NETE's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

19.1%

NETE

3.7%

US Software

2.4%

US Market


1 Year Return

-35.7%

NETE

33.0%

US Software

9.2%

US Market

Return vs Industry: NETE underperformed the US Software industry which returned 33% over the past year.

Return vs Market: NETE underperformed the US Market which returned 9.2% over the past year.


Shareholder returns

NETEIndustryMarket
7 Day19.1%3.7%2.4%
30 Day38.4%9.5%10.2%
90 Day-7.6%16.2%3.4%
1 Year-35.7%-35.7%34.0%33.0%11.6%9.2%
3 Year-65.9%-65.9%128.7%120.8%33.7%24.9%
5 Year-95.3%-95.3%206.8%188.0%59.7%41.8%

Price Volatility Vs. Market

How volatile is Net Element's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Net Element undervalued compared to its fair value and its price relative to the market?

3.43x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate NETE's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate NETE's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: NETE is unprofitable, so we can't compare its PE Ratio to the Software industry average.

PE vs Market: NETE is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate NETE's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: NETE is good value based on its PB Ratio (3.4x) compared to the US Software industry average (6.2x).


Next Steps

Future Growth

How is Net Element forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?

3.1%

Forecasted annual revenue growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Insufficient data to determine if NETE's forecast earnings growth is above the savings rate (2.2%).

Earnings vs Market: Insufficient data to determine if NETE's earnings are forecast to grow faster than the US market

High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: NETE's revenue (3.1% per year) is forecast to grow slower than the US market (8.8% per year).

High Growth Revenue: NETE's revenue (3.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if NETE's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Net Element performed over the past 5 years?

20.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NETE is currently unprofitable.

Growing Profit Margin: NETE is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: NETE is unprofitable, but has reduced losses over the past 5 years at a rate of 20% per year.

Accelerating Growth: Unable to compare NETE's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: NETE is unprofitable, making it difficult to compare its past year earnings growth to the Software industry (9.6%).


Return on Equity

High ROE: NETE has a negative Return on Equity (-240.12%), as it is currently unprofitable.


Next Steps

Financial Health

How is Net Element's financial position?


Financial Position Analysis

Short Term Liabilities: NETE's short term assets ($5.9M) do not cover its short term liabilities ($8.5M).

Long Term Liabilities: NETE's short term assets ($5.9M) do not cover its long term liabilities ($8.6M).


Debt to Equity History and Analysis

Debt Level: NETE's debt to equity ratio (326.7%) is considered high.

Reducing Debt: NETE's debt to equity ratio has increased from 105.1% to 326.7% over the past 5 years.


Balance Sheet


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: NETE has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: NETE has less than a year of cash runway if free cash flow continues to reduce at historical rates of 16.7% each year


Next Steps

Dividend

What is Net Element's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate NETE's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate NETE's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if NETE's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if NETE's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of NETE's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

6.7yrs

Average management tenure


CEO

Oleg Firer (42yo)

7.17yrs

Tenure

US$1,462,312

Compensation

Mr. Oleg Firer has been Chief Executive Officer of Net Element, Inc. since April 16, 2013 and has also been its Director since April 16, 2013 and Executive Chairman since November, 2018. Mr. Firer served a ...


CEO Compensation Analysis

Compensation vs Market: Oleg's total compensation ($USD1.46M) is above average for companies of similar size in the US market ($USD589.00K).

Compensation vs Earnings: Oleg's compensation has increased whilst the company is unprofitable.


Leadership Team

NamePositionTenureCompensationOwnership
Oleg Firer
Executive Chairman & CEO7.17yrsUS$1.46m10.32% $1.1m
Jeffrey Ginsberg
Chief Financial Officer1.92yrsUS$179.33k0.32% $34.2k
Steven Wolberg
Chief Legal Officer & Secretary7.17yrsUS$842.80k0.89% $95.5k
Andrey Krotov
Head of Technology6.25yrsno datano data
Giovanni Di Febo
Head of Acquiring & Complianceno datano datano data
Vladimir Sadovskiy
Head of Integrated Paymentsno datano datano data
Shawn Brown
Head of Risk Managementno datano datano data
Svetlana Esennikova
Head of Online Solutionsno datano datano data

6.7yrs

Average Tenure

53yo

Average Age

Experienced Management: NETE's management team is seasoned and experienced (6.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Oleg Firer
Executive Chairman & CEO7.17yrsUS$1.46m10.32% $1.1m
Howard Ash
Independent Director4yrsUS$90.81k0.035% $3.8k
Jon Najarian
Independent Director2.25yrsUS$43.23k0.25% $26.6k

2.3yrs

Average Tenure

60yo

Average Age

Experienced Board: NETE's board of directors are not considered experienced ( 2.3 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Net Element, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Net Element, Inc.
  • Ticker: NETE
  • Exchange: NasdaqCM
  • Founded: 2004
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$10.741m
  • Shares outstanding: 4.20m
  • Website: https://www.netelement.com

Number of Employees


Location

  • Net Element, Inc.
  • 3363 NE 163rd Street
  • Suite 705
  • North Miami Beach
  • Florida
  • 33160
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NETENasdaqCM (Nasdaq Capital Market)YesCommon StockUSUSDOct 2012
1N52DB (Deutsche Boerse AG)YesCommon StockDEEUROct 2012

Biography

Net Element, Inc. operates as a financial technology and value-added solutions company in North America, Russia, and the Commonwealth of Independent States. It operates in two segments, North American Transaction Solutions and International Transaction Solutions. The company offers a range of payment acceptance and transaction processing services that enable merchants of various sizes to accept and process approximately 100 payment options, including credit, debit, prepaid, and alternative payments; and value-added services and technologies, such as integrated payment technologies, point-of-sale solutions (POS), fraud management solutions, information solutions, and analytical tools. Its services include Unified Payments that provides integrated payment acceptance solutions, value-added POS, and business process management services; Unified m-POS, a mobile POS application that accepts payments; Aptito POS Platform, an integrated POS platform for the hospitality, retail, service, and on the go industries; Restoactive, a POS restaurant management platform; Zero Pay, a zero-fee payment acceptance program for SMB merchants; transactional services, mobile payment transactions, online payment transactions, and other payment technologies under the PayOnline name; Pay-Travel, an integrated payment processing solutions to the travel industry; and Netevia, a multi-channel payments and merchant management platform that delivers end-to-end payment processing through easy-to-use APIs. Net Element, Inc. offers its services through retail and mobile merchants, as well as online. The company was formerly known as Net Element International, Inc. and changed its name to Net Element, Inc. in December 2013. Net Element, Inc. was founded in 2004 and is based in North Miami Beach, Florida. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/04 04:26
End of Day Share Price2020/06/03 00:00
Earnings2020/03/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.