1:00 – Geoff’s (members only) articles on NIC are “NIC (EGOV): A Far Above Average Business at an Utterly Average Price” (January 15th, 2018) and NIC (EGOV): Loses its Biggest Customer (Texas) – Stock Drops 20% Instantly” (February 1st, 2018).
2:40 – NIC is headquartered in Olathe, Kansas.
3:10 – Tyler Technologies (TYL) has a market cap of $5 billion (vs. less than a $1 billion market cap for NIC). It is headquartered in Plano, Texas.
4:35 – NIC’s three most recently lost state contracts are: Texas (will expire in August of 2018), Tennessee (expired March of 2017), and Iowa (expired November of 2016).
5:10 – NIC has 15 state contracts that can be terminated without cause. Those 15 agreements account for 63% of NIC’s total revenue.
6:10 – Geoff’s estimate for the least possible harm the loss of Texas could do to NIC’s earnings is presented in the comments thread to the article “NIC (EGOV) Loses its Biggest Customer (Texas) – Stock Drops 20% Instantly (February 1st, 2018)”
9:00 – Geoff meant to say “it’s a very safe company” not “it’s a very safe stock”. The stock might drop a lot in price. But, there is no financial risk of insolvency, bankruptcy, etc. here at all.
9:35 – The ad agency stock Geoff invested in was Omnicom (OMC). It lost the Chrysler account in 2009.
10:10 – In 2001 (so 17 years ago), NIC had 17 state contracts which is about one-third of all states versus today when they have about half of all states.
10:25 – Same-state interactive government services revenue grew 11% last year.
10:30 –NIC has half of all U.S. states as clients and is valued at an enterprise value of $700 million (after losing the Texas contract). So, the stock market is valuing the entire addressable market of 50 “dot gov” portals at no more than $1.4 billion in market value and about $600 million in revenue (NIC has $300 million in revenue from state portals and a little over half of all “dot gov” portals in the U.S.).
12:00 – EGOV shares are now down 42% in the last twelve months. The market is up 20%+.
13:40 – NIC had paid a tax rate between 35% and 40% in 13 of the last 15 years.
15:30 – Geoff means that the quick and widespread adoption of driverless cars in the U.S. should not lower NIC’s revenue growth rate by more than 2% a year versus a scenario where no driverless cars are on the road (the status quo). He goes into the arithmetic behind this assumption in the comments section of his article “NIC (EGOV): A Far Above Average Business at an Utterly Average Price” (January 15th, 2018)”
17:10 – NIC stock has a 2.5% dividend yield on its current price of $12.90 a share.