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Posted by: GordonGecko
In reply to: None Date:2/6/2008 10:11:17 PM
Post #of 1773

.<font color=platinum>*PCLI* DD Summary UPDATED

The latest on PCLI is that a WALGREEN PARTNERSHIP has been CONFIRMED through Sheff's conversation with Mr. Newman. check the link below;
http://investorshub.advfn.com/boards/read_msg.asp?message_id…

Also, one could EXPECT PCLI to appear on CNBC, CNN, The Wall Street Journal with the recent hired IR FIRM !!! HUGE
http://investorshub.advfn.com/boards/read_msg.asp?Message_id…

Here is a MUST READ POST ON THE STOCK;

Posted by: tedpeele
In reply to: GordonGecko who wrote msg# 593 Date:1/23/2008 11:41:24 AM
Post #of 1018

Long term price projection:

The company recently responded to an investor on their IR site, who was asking for performance projections, as follows (in part):

"Our primary goal in 2008 is to increase shareholder value through an expansion of our DVD on-demand service with as many store and web retailers as possible, which in turn drives revenue. A key element to driving sales is also the licensing of movies and other entertainment products from content owners, which we are aggressively pursuing. We generally do not release revenue and PPS estimates at this stage of our development. Overall, we are very bullish about 2008."

That got me to thinking a bit more about the longer term picture, and what a reasonable projection might be. Much of the following is a summary of my thoughts about that.


It is far too early to place much faith in number projections, but to me--as a believer in the concept and TitleMatch's competitive position--I think the following scenario is possible--maybe even a 50/50 proposition:


Kiosk market share
At some point within 2-3 years they will have 5,000 kiosks placed. This is based on the William Blair projection of 25,000-35,000 kiosks placed by 2012 combined with the leading position TitleMatch currently has, along with the assumption that TitleMatch will be able to land national retail accounts --an assumption supported by the 200 store trial with a national retailer. I think 5,000 is reasonable and may be conservative, as it represents only 14-20% market share.


<Average daily sales>
I'm assuming sales will be at least 6 DVDs per day. Based on info on the web, each Walmart sells around 300-500 DVD's per day. This sounds way too high at first glance, but this is based on web info that Walmart sells 40% of all DVD's sold, that the total number of DVDs sold annually is about 1.7 billion, and that there are 4,000 Walmart stores. During the Christmas season, I can easily believe a store sells more than 1,000 per day. If Walmart's market share is more like 20%, then perhaps the accurate number is closer to to 200 a day.

Consider the following additional points:
*One study showed that 1/3 of people looking to buy a DVD leave the store without buying because they can't find one. Many of these people would likely welcome the kiosk alternative.

*A person may be able to order a DVD from the retailer website, or a content-owner site linked to the retailer, from their home, and drive to the local store and pick it up at their convenience.

*Collectors of movies or entire TV series, and people buying for others may order half a dozen or more at a time using this method.

*The retailer can pre-burn the hottest selling DVD's and have them sitting on shelves near the kiosks to attract additional sales.

Considering all of the above, it seems to me VERY reaonsable--even conservative, to assume that each store will sell at least 6 DVD's per day via their kiosk (which can create 2 DVD's at once--each taking 6 minutes).


Revenue calculation
Assuming 5,000 kiosks, and 6 sales per day, and a royalty to PCLI of $1.5 per transaction/sale, and a license fee of $100 per kiosk per month, this computes to roughly $22 million in revenues. Assume another $4 million in online sales (could be much higher).

Expenses calculation
With current expenses running about $4 million a year, I'd bump it to $5 million, add $2 million for online fulfillment (50% gross margins), and only perhaps $4 million for the kiosk business (80% margins--software margins should be very high).

Net income, shares, and EPS calculation
With no taxes for a while due to aggregate losses, Net income therefore would be $15 million (26 minus 11). Assuming some further dilution (not significant due to higher share prices) and exercised warrants bring the outst shares to 150 million, that is 10 cents a share EPS.


Price calculation
Given the outstanding growth and still further prospects at that time, the PE could be anywhere from 20 to 50 (sometimes they go over 100), or a share price range of $2.00-5.00.

To my way of thinking, this scenario could be played out in 2-3 years, which makes the current share price of .07 very attractive, as that is a return of 30-70 fold.


Of course things may not go nearly as well for various reasons. Or conversely maybe they could go much better--maybe they will have 10,000 placed and/or each one sells 10-20 per day. In any case, these projections are the reasons why I see not only an attractive short term situation, but a long term one as well.

ted

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aus der Diskussion: Protocall Technologies (PCLI.OB) $$$ Chance
Autor (Datum des Eintrages): oneguy  (15.02.08 23:20:50)
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