AmeriGuard Security Services, Inc. 10-K Filing Analysis for Fiscal Year 2023

AmeriGuard Security Services, Inc. (AGSS), a prominent player in the security services industry, has recently released its 10-K filing for the fiscal year ended December 31, 2023. This comprehensive analysis aims to dissect the financial health, operational performance, and future prospects of AGSS, providing investors with a detailed overview of the company's investment potential.

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Company Overview

AGSS was incorporated in Nevada and operates through its subsidiary, AmeriGuard Security Services, Inc., in California. The company specializes in providing armed guard services as a federal contractor and commercial guard services, primarily in California. In a strategic move to expand its service offerings, AGSS acquired TransportUS Inc., a company specializing in human transportation services for federal contracts, in October 2023.

Financial Performance

Revenue and Net Income

AGSS reported a total revenue of $24,350,618 for the fiscal year 2023, a decrease from $29,139,403 in 2022. This decline is primarily attributed to the termination of a contract with the Environmental Protection Authority (EPA) in May 2023. Despite the decrease in revenue, the company managed to report a net income of $122,636, a significant improvement from a net loss of $392,919 in the previous year. This turnaround can be credited to the company's effective cost management strategies and the receipt of the Employee Retention Tax Credit.

Expenses

The company's total operating expenses increased to $4,474,036 in 2023 from $3,280,748 in 2022. The rise in expenses was due to the establishment of an IT department, an east coast operations group, and a new Human Resource department. Despite the increase in operating expenses, AGSS's strategic decisions and operational efficiencies have paved the way for a positive net income.

Investment Potential

AGSS's strategic acquisition of TransportUS Inc. and its ability to navigate through the loss of a major contract while still achieving profitability highlight the company's resilience and adaptability. The company's focus on expanding its service offerings and its proactive approach to managing operational costs are promising indicators of its potential for growth and profitability.

Risks

Investors should note the company's reliance on federal contracts, which accounted for approximately 87% of its total revenue. While AGSS has demonstrated its capability to secure and manage these contracts effectively, any changes in federal contracting policies or loss of contracts could impact the company's financial performance.

Future Outlook

AGSS is well-positioned to capitalize on the growing security services and non-emergency medical transportation markets. With a strong management team, strategic acquisitions, and a focus on expanding its service offerings, AGSS presents a compelling investment opportunity for those looking to invest in a company with solid growth prospects.

Conclusion

AmeriGuard Security Services, Inc. has demonstrated its ability to adapt to changes and capitalize on opportunities within its industry. While there are inherent risks associated with its reliance on federal contracts, the company's strategic moves, operational efficiencies, and positive financial performance in 2023 make it an attractive investment option. Investors looking for a company with a strong foundation and potential for growth should consider AGSS as a viable addition to their portfolio.