TOP IDEAS: Titan Logix (TSXV: TLA) sees renewed sales momentum in traditional crude oil markets while introducing new business controls solutions for revenue diversification.

Note: Investorfile's share price accumulation target of $0.75 for Titan Logix Corp. was reached on February 5, 2013. For the record, we do not revise share price targets for our Top Ideas - Small Cap Value Stocks. We have positioned our blog to be one of the first providers for a pragmatic perspective of a small cap company stock's potential worth, where there may be uncovered value that has been largely overlooked by the investment community.

Titan Logix Corp. (TSXV: TLA - C$0.57) was down but never out as the Company’s turnaround takes hold.

It is hard to believe that since the collapse of world oil prices several years ago and the massive spending cuts that followed by the oil and gas-related industries (Titan Logix’s main market), the Company could survive. Well, it did, mainly due to its very strong balance sheet.

It has been a little over a year ago since we last provided an update on Titan Logix (See: Time to revisit Titan Logix, a cash-rich small cap stock with an upside). At that time, the Investorfile blog was of the opinion that Titan Logix was now beyond survival mode. We also suggested in that post that the Company could show a profit from operations in the latter half of fiscal 2018.

It turns out we may be right!

Titan Logix is an industrial technology company focused on the manufacturing and marketing of advanced fluid management solutions. The Company's flagship products, the Finch II™ display/controller, designed for use with the Titan TD80™ - a Guided Wave Radar (GWR) gauge for mobile crude oil tankers - is the market leader for electronic fluid level measurement and overfill prevention products in North America.

Over the summer, the Company released its fiscal 2018 Q3 financial results and, as we expected, Titan Logix is no longer losing money.The Company reported net earnings of $105 thousand for the quarter, which was primarily a result of the increase in revenue and gross profit combined with an increase in finance income.

In Q4 we expect the financial results will improve further. Why? Company Management has confirmed the demand for new crude oil road tankers in North America (the Company’s traditional market) is ramping up and that Titan’s flagship GWR products have maintained their strong market share. This means sales are poised to accelerate and so will profits moving forward.

What is also accelerating is the Company’s vision to diversify its revenue streams by being a data generation and collection facilitator using its GWR instruments. The Company has said that it has partnered with a software provider for the world’s first cloud-based solution for supply chain management of produced water, resulting from fracking operations. Management believes that the expanded vision of becoming a data generation and collection specialist has opened market opportunities to tap into the wave of data mining and analytics for business control solutions in new verticals, outside of the crude oil industry.

Since our last blog post, our investment thesis on Titan Logix remains firmly intact: There is little downside (and plenty of potential upside) in owning this stock. We want to point out that as May 31, 2018, the Company had about C$12.9 million in cash and secured loan investments (C$0.45/per share) and is debt-free. This implies (at today’s stock price of C$0.57) that Titan’s business has a market value of only C$3.4 million, which is a bargain basement price. That said, and given our forecast that the Company’s operations are returning to profitability, we are still encouraging small cap value investors accumulate stock to a high of C$0.75 per share. The caveat this time is that the potential upside is greater now!

Titan Logix has approximately 28.5 million shares outstanding.

The Company’s website: www.titanlogix.com

Author Ownership Disclosure: TSXV: TLA- Yes

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