Commerce Department Says Economy Gaining Speed Despite a Number of Negative Factors
 The most recent report out of the U.S. Commerce Department provides the market with a much needed morale boost, stating that our economy experienced its fastest growth - 3.9% - in 1.5 years during the July-September quarter. Speaking about our country's economy, Ed Lazear, the chairman of Bush's Council of Economic Advisers commented "This is an extremely resilient economy," he said. "It is really quite remarkable." Although the credit crunch is obviously a major concern, the article below provides more than a glimmer of hope that maybe things aren't so bad after all. At least not quite yet. http://biz.yahoo.com/ap/071031/economy.html?.v=25Labels: Economy, U.S. Commerce Department
Massive Opportunity Present for VoIP Wholesalers: Which Ones Will Capitalize
 With On World Inc. estimating that the number of VoIP users will balloon from about 16M in '06 to 207M by 2011, capable VoIP players will be faced with great deal of opportunity over the next few years. But while many wholesalers have made a boatload on what many label "VoIP arbitrage" over the past half decade or so, as large telecom's such as AT&T enhance their respective service offerings, competitors must advance their value propositions from strictly cost-effective pricing structures to include an increasing number of value-added services or risk being passed over in favor of the big boys. Article on AT&T's expanded service offering: Although many consumers have been drawn in by VoIP's cost efficient characteristics, the next wave of growth, despite being somewhat apparent, may take a bit more to incite. I think that many consumers need to be compelled to use VoIP as an alternative to traditional telephony. Bundling features with other industry players, enhancing security and call quality are all areas that many lower-tiered suppliers should be focusing on now, before the big telecoms swallow up all of the guppies. Labels: VoIP
Dollar Continues To Slip Vs. Euro
Fire in the West
 Unless you've been hiding under a rock for the past few days, you are aware of the ongoing wildfire situation in Southern California. 45 people have been injured, 5 people have been killed, 500,000 homes were evacuated and so far 1500 homes have been destroyed. While our doors were shut due to a mandatory evacuation earlier this week and the phone lines were temporarily down, things are back to normal here at MSP and everyone here and their families were fortunate enough to come through this disaster unscathed. Unfortunately that is not the case for the hundreds of thousands still evacuated and the many families returning to rubble where their homes once stood. We'd like to start off this edition by saying that our thoughts and prayers are with all of those affected by the recent catastrophe and are confident that, through the generosity of Americans, these communities will soon be pieced back together again. CPNE - To Split or Not to Split  So, in the spirit of dusting off the computers and catching up on lost time, we thought we would touch on a few topics that we felt would wrap up the week on a strong note. After taking investors on a tumultuous ride that saw share price soar upwards into the $3.50 range from under a quarter and then free fall all the way down below a dollar where it sits today, Commerce Planet Inc. (OTCBB: CPNE) announced plans to apply for listing on a National Exchange earlier in the week. While the move is very positive for the company, it may not be quite so rosy for most current shareholders. CPNE meets or exceeds every possible requirement criteria to trade on a senior exchange, except for one, share price! So, the obvious move is a reverse split. In my experience, reverse splits carry with them a very negative connotation. This is even truer over the near-term following the split. Long term, those willing to stay on board could be rewarded greatly, but if my dollar today is worth a quarter tomorrow, how can that be positive for me economically until my dollar rises back to its original value? Despite this being a risky move on CPNE's part, we think this company has the wherewithal to execute it successfully. For long-term holders, this is what we call crunch time. It's time to weigh the pros and cons of sticking it out for a home run or taking some ducats off the table. We have long been believers in CPNE and we still think this company is going to become one of our diamonds in the rough. We'd love to hear your thoughts and our blog represents a great forum for voicing your opinion. ATSI Communications: Stellar FY2007 ATSI Communications Inc. (OTCBB: ATSX), one of the most promising companies in our small-cap portfolio, continues to impress the investment community with its improving financials. Management announced last week that revenues for the 4th quarter trumped those of Q3 by almost $2,000,000 and towered over Q4 '06 by nearly 90%. ATSI has now logged 12 consecutive quarters of record revenues, 5 consecutive quarters of positive cash flow from operations and 3 consecutive quarters of net positive earnings per share. The real game breaker here at this point in time appears to be ATSI's flare for international business. Since the majority of VoIP growth is anticipated to occur in markets outside of the U.S. over the next five years, The Company's ability to establish business relationships with international telecommunications players, including the Mexican government and PCCW Ltd, continues to facilitate an improving financial situation for the company. ATSI is entrenched in Mexico, the world's number one user of voice traffic along with the U.S., and a $2 billion+ telecommunications market. This has been a key factor driving growth to current levels. ATSI's success in Mexico is facilitated by its (49%) interest of a subsidiary in Mexico, ATSI Communications, S.A. de C.V - that operates under a 30-year government issued telecommunications license similar to the license owned by AT&T's subsidiary in Mexico. Since the Mexican government has a well- documented history of being stringent in its introduction of telecommunications competition and has constructed significant roadblocks to new market entrants, possession of a long-term concession license in the country should be viewed as a major advantage for ATSI. At a price of just under $.30, we are very bullish on ATSI Communication's potential over the next 12 months. Nighthawk - Highest Revenues in 4 Years Nighthawk Systems Inc. (OTCBB: NIHK) provided guidance Wednesday on 3rd quarter earnings that marked the company's highest revenues in the past 4 years. With revenues improving on both quarter-over-quarter and sequential basis, investors embraced the guidance warmly as the stock traded up over 11% to .1140 on volume exceeding 5,000,000 shares. As of 11:00 PST on Thursday morning, share price has held stable. Could we be looking at a new bottom? Since NIHK recently acquired a high potential IPTV set-top box business and management has stated publicly that revenues for the first nine months of 2007 already exceed those of calendar year 2006, and also that future IPTV related sales could accelerate near-term revenue growth rates by a multiple of two, the market may have awoken to some extent and started pricing that potential into shares. Just a thought. . . Marmion Industries: Almost Profitable? Marmion Industries Corporation (OTCBB: MMIO) traded incredibly on Thursday with no news. The stock gained nearly 30% on volume exceeding 4,000,000 shares. For those of you still scratching your head, we thought you might appreciate a tidbit of information we stumbled upon from loyal subscribers. The fact that the market at large is becoming increasingly aware of MMIO's progress may help explain the surge in activity lately. When you cut out the company's current financing agreement, which is essential in the construction of a new facility that will sustain current growth and allow for higher volume production, MMIO is pretty darn close - if not already - profitable. Which is more than General Motors can say for itself! As a public company breaks into the market, the amount of capital necessary can often be the company's undoing. This begets the necessity for financing - often an even greater cause of demise. For a small cap company, climbing its way to profitability means chewing through large amounts of debt just to start at ground zero. Knowing the nuances of the small cap industry is vital to understanding how to invest in it wisely. That being said, profitability is not only a rarely achieved Labels: ATSI, ATSI Communications Inc., ATSX, Commerce Planet, Commerce Planet Inc., CPNE, Marmion Industries, Marmion Industries Corp., MMIO, Nighthawk Systems, Nighthawk Systems Inc., NIHK, NIHK.ob
Motorola Expects Big Things From IPTV Market
 Motorola Expects Big Things from IPTV Market
It appears that Nighthawk Systems Inc. (OTCBB: NIHK) picked the right market, particularly if IPTV expert Motorola is on point with recent estimates on industry growth. Motorola expects that:
The residential IPTV subscriber base to balloon from nearly 4.6 at the end of ’06 to nearly 60 million by the end of 2011; and
Shipments of IPTV set-top boxes to reach 7 million in 2007 and grow to more than 20 million by the end of 2011.
Now coming to market with an industry leading M2M and IPTV products, NIHK is beginning to gain some serious traction in two of the world’s hottest markets. Labels: IPTV, M2M, Motorola, Nighthawk, Nighthawk Systems Inc., NIHK
A Boost For The Global VoIP Market?
 With nearly 30 EU telecom regulators aiming to put in place standards that allow for citizens to utilize the same VoIP phone number in any European Union country, it's likely that more in the region will utilize the technology in the coming years. This is just another positive development in the VoIP world. Labels: VoIP
Another Record Quarter On The Horizon For NIHK
Nighthawk Systems Inc. (OTCBB: NIHK) provided guidance today on rosy 3rd quarter earnings today that saw revenues improve on the $899,000 logged during Q2 and increase nearly 55% over Q3 '06. Investors embraced the news with open arms as the stock traded up over 11% to .1140 on volume exceeding 5,000,000 shares. With its traditional business making record quarterly growth seem somewhat commonplace recently, adding on the high potential IPTV set-top box biz provides a new level of hope for the company bringing annual revenues into the double digit million range. For the near to mid-term, the IPTV business may prove to be the icing on the cake for NIHK. With management stating that revenues for the first nine months of 2007 already exceed those of calendar year 2006, I'd say things were chugging along just fine prior to the recent acquisition. CEO Doug Saathoff states in today's release that the IPTV biz could possibly accelerate near-term revenue growth rates by a multiple of two. If that's the case, the market may have awoken to some extent today and started pricing that potential into shares. Just a thought. Labels: Nighthawk, Nighthawk Systems, Nighthawk Systems Inc., NIHK, NIHK.ob
ABI Says WholeSale VoIP Segment Poised for Growth
 With the North American Residential Video market becoming increasingly saturated - research firm ABI Research indicates that the wholesale VoIP sector is becoming an increasingly attractive prospect for cable providers yearning to hedge their losses brought on in part by declining video revenues. This could make things even more interesting for VoIP providers of all sizes, from IBASIS Inc. (NasdaqGM:IBAS) to ATSI Communications Inc. (OTCBB: ATSX). According to a recent write up by Mae Kowalke, TMCnet Associate Editor that summarizes the ABI report: "For 2007, ABI predicts that residential video will account for roughly $170 billion in revenues worldwide; voice, data, SMB/cellular backhaul and advertising collectively will add another $92 billion. By 2012, ABI estimates, though, those figures will be almost equal, at $268 billion for video and $279 billion for other services—with the supporting players overtaking video. "
Here's a link to the article. Just another promising development for capable VoIP service players:
Labels: ATSI, ATSI Communications Inc., ATSX, IBASIS, VoIP
Washington Technology Names Top 100 Govt. Contractors
Washington Technology recently released its list of the Top 100 Federal Prime Contractors: http://www.washingtontechnology.com/top-100/2007/Boeing made the jump up from #15 in 2006 to #2 in 2007 while telceom provider Qwest Communications - (NYSE: Q) checked in at #54 out of all public entities in 2007, deriving more than $250,000,000 from government contracts. The list serves as a pretty solid reminder of the money to be made through the pursuance of government contracts. Though the road to contract wins in this arena is a long and hard one, particularly for non-multi billion dollar organizations, just one deal can make or break a company. Labels: Top 100 Government Contractors, Washington Technology
The Perfect Solution To The World's Energy Crisis?
 Could good old McDonald's one day surpass ConocoPhillips as a leading fuel supplier? Before you write me off as an invalid, just here me out for one minute: The need for economical alternative energy sources is reaching paramount heights. As raw material costs for soy, corn, and other sources increase, the search is on. One idea that I've stumbled upon is the process of filtering brown grease, you know, the crap that builds up under your favorite dining establishment and clogs up the sewers like a fat guy's arteries? It's also really good food for rats, one of the most disease infested creatures known to man. Sound enticing? The brown grease problem is so bad in New York it gave a waste treatment plant in Suffolk County a "heart attack" a few years back and had processing moved to New Jersey. Until recently nobody could do anything with it. A company that I came across by the name of Bio Solutions Manufacturing, Inc. (BSLM.OB) is about to change all of that. They have produced their first samples of B100 and have the proven ability to make usable fuel from brown grease. While many establishments pay a ton to have the crap removed from their facilities, these guys are pursuing arrangements to take it away and process it at a growing number of facilities which will be built down the road. What a self sufficient society we could build if we develop the necessary capabilities to fuel our lives with our own waste. Nice concept eh? If BSLM can bring their business plan to fruition, which at after an initial glance I think is possible, particularly due to the pedigree of the management team, which I'll discuss in the future, this could be a household name and a blue chip stock someday. I'll update you in a more articulate matter in the near future, but wanted to bring you this idea first, before anyone else. Labels: Alternate Energy, B100, Bio Fuel, Bio Solutions Manufacturing Inc. (OTCBB: BSLM), BioFuel, Brown Grease, BSLM, BSLM.ob, Energy Crisis
ATSX: Growing Like Gangbusters
 ATSI Communications Inc. (OTCBB: ATSX), one of my favorite portfolio companies at this point in time, continues to impress with its continuously improving financial situation. Their revenues are up 116% year-over-year and have grown, I believe, in 12 consecutive quarters. Despite margins, which remain thin like many other VoIP players, ATSI produced record gross profits, its 5th consecutive quarter of positive cash flow from operations, and 3rd consecutive quarter of net positive earnings per share. ATSI’s recent success is directly attributable to management’s ability to maintain extremely favorable business relationships in key emerging regions including Latin America and Asia-Pacific where many prospective telecommunications carriers lack the proper regulatory licensing and optimal transmission capabilities necessary to operate. An entrenched position in Mexico through a unique 30-year, long distance concession license with the local government has facilitated transformational financial improvements for the company and also provides a high level of opportunity going forward as VoIP and Internet adoption surge in the region. Look out for this stock to continue to impress going forward. At just over a quarter, you may want to kick off your due dilly now. Look out soon for some buy side research from us that details the good, the bad, and the ugly; as it pertains to ATSI Communications Inc. Labels: ATSI, ATSI Communications Inc., ATSX, Earnings, VoIP
Telling Your Co-Workers To F#@k Off Boosts Morale!
File this one in the "I was waiting for the world to figure this out" category. According to an article today on www.yahoo.com - a team of researchers from the University of East Anglia found that "Regular swearing at work can help boost team spirit among staff, allowing them to express better their feelings as well as develop social relationships, according to a study by researchers." With the exception of cussing out senior mgt. and customers, and executing slanderous attacks on co-workers, the study finds that workers simply just need to voice their feelings and sometimes swearing is the best way to get it all out. Read the article in its entirety: http://news.yahoo.com/s/afp/20071017/od_afp/britainemploymentlanguageoffbeat_071017155439Labels: Swearing at Work
Volume Flares Up on Micro Caps
 Lots of Action in our Micro Cap World This Week!Over the weekly hump and it has been a busy week thus far. Although we typically focus on just one company in each edition of our newsletter, an overflow of positive news from our portfolio companies this week has forced us to approach things a bit differently today and bring you our three immediate-term growth front runners. Before we get into today's news, we thought we'd mention that all of our previous newsletter editions and additional commentary can be found on the MicroStockProfit Blog. EXCS Sales up Nearly 60%
Execute Sports Inc. (OTCBB: EXCS) announced this morning that overall, year-to-date sales have increased nearly 55% over 2006. The jump from $935,541.31 logged in the first three quarters of 2006 to $1,444,743.67 in 2007 is probably the premier indicator that EXCS has embarked on a new era of growth. Record sales levels also exhibit the company's unique future potential with former Body Glove executive Celeste Berouty situated as President.
Check out our Blog entry from Tuesday for a rundown of exactly why I think this stock has to perform better over the next three to six months.
The market has reacted extremely well to Tuesday's potential $6,000,000 announcement out of Nighthawk Systems Inc. (OTCBB: NIHK) and should grow even more fond of the stock after today's news highlighting an order worth $488,050 - or about 43% more than total second quarter revenues - from a major customer. NIHK's decision to purchase the IPTV set-top box business assets of Eagle Broadband was a pretty slick move, particularly since the boxes are already generating sales for the company just days after the business segment was acquired. Nighthawk's current backorder of more than $900,000 exceeds the company's revenues for the entire 2006 fiscal year and exemplifies the forward direction that operations are moving in. Sure I'd like to see the bottom line tidied up a bit, but then again, if they were showing a profit, I'm thinking we'd be around $0.50 or higher versus $0.10. Don't forget that this stock
 Marmion Industries Corporation (OTCBB: MMIO) continues to execute on previously announced contracts. After a press release announcing a letter of intent last July, management noted today that they have received a work release notice for a change order valued at nearly $100,000 for a project at the Debakey High School in Houston, Texas. MMIO also has an additional 20 or so add- ons pending approval which will increase the project's ticket, which I estimate to be worth a hair under $1,000,000. Today's news is especially great in my opinion because it exhibits management's ability to deliver on contracts. It also helps to solidify Marmion's position in the commercial HVAC market which acts as a pretty nice complement to the industrial business. With ARC Advisory Group forecasting the worldwide market for HVAC control systems to continue growing at a compounded annual growth rate (CAGR) of nearly 4% over the next five years, growing from $10 billion in 2006 to nearly $13 billion in 2011; MMIO has a lot of room to grow. Management is ramping up sales/marketing efforts and for the first time and pursuing business rather than simply relying of word of mouth to drive revenues. Simply put, I expect monumental growth for the company going forward. With net income of $212,000, as of their last reporting period, continued near-term sales growth, such as that being exhibited recently, could turn this thing around in a major way. The foundation is in place for EXCS, NIHK, and MMIO and going forward all of these companies seem to do nothing but grow and improve. So why the poor stock performance? Obviously, value here is just increasing. Yet the market seems to waiver in it's faith daily. Eventually, these companies will get their legs in the market and today's prices will be yesterday's news. In the meantime, day traders and long term investors alike should find some good entry points this week. Labels: Body Glove, EXCS, Execute Sports, Marmion Industries, MMIO, Nighthawk Systems, NIHK
Sales Keep Heading Up Up Up!
 Yesterday was a good day for MicroStockProfit subscribers. If you jumped on our Monday morning pre-market Nighthawk Systems (OTCBB: NIHK) alert, you likely got a nice investment gain to go with your frenzied Monday morning. Closing Friday at $0.08, NIHK was on our radar for a strong following week in the market. Hopefully, many of you got to pull a little off the table as it traded up on HUGE volume yesterday morning and closed at $0.106 (just a hair off its intraday high of $0.107) - a gain of over 32%! Not a bad way to kick off your week. Now on with the show. . .
Over the past year, we have seen quite a bit out of Execute Sports Inc. (OTCBB: EXCS). The company has emerged from virtual upheaval and is reaching milestone after the milestone. Today, EXCS is out with yet another positive news release that should have investors and shareholders excited for the future of the rapidly emerging water sports player. According to EXCS, preliminary orders for 2008 OEM produced Life Vests will increase by nearly 61% over 2007 production. So applying a little "back of the napkin" math and making the assumption that overall OEM sales are growing at roughly the same rate as OEM life vests, pre-orders for 2008, which hasn't even technically begun yet, equate to nearly $1,600,000 in 2008 revenues. Even if life vest sales contribute only 30% to overall OEM sales and this is the only private label OEM product experiencing such tremendous growth, we're still looking at a very healthy increase since these are 2008 orders are being logged with about 2.5 months left in 2007. For a company that logged only $2,000,000 in 2006 revenues, this is a major deal - particularly since OEM/Private label sales make up only a small portion of the company's overall sales and we are only speaking in terms of preliminary orders. Actual 2008 OEM sales will likely be much higher given the many months that Execute now has to log more orders. Sometimes, a list is the best way to get a handle on company details. Let's take a look at some of the positive forces that are currently working in sync to foster a positive future for Execute Sports. Here are a few of my favorites in non-chronological order. 1. The Chart - EXCS shares have found support in the $.02 range and investors don't seem at all willing to part with the stock at lower prices. It appears that we have reached a bottom, and judging by the ongoing improvements being made on behalf of management, it doesn't seem like we can stay parked here forever. The company is simply performing too solidly, both from a financial and operational perspective for that to happen. 2. Record Sales - After announcing all-time record high sales for the second quarter back in July, Execute has issued a string of very positive corporate announcements regarding many aspects of their stellar sales performance. As of 9/27/07, Year-to-date internet sales had increased 38% over 2006 and Execute branded products were accounting for nearly ½ of ALL online sales in each of their core product lines. This rapid growth (online sales just started in March of '06) has been facilitated through management's ability to get their products online with leading retailers including: The Sports Authority, Dick's Sporting Goods, Joe's Outdoors, Sport Chalet, Modell's and MC Sports. 3. Recent $5,000,000 Sugar Sand Boat Acquisition - By purchasing Sugar Sand, Execute, recognizes the benefits of both a cash influx of $7-10 million during year one and the addition of a complementary brand. U.S. law stipulates that all recreational boats must carry one wearable PFD for each person aboard and that each passenger under 12 years of age must wear a flotation device at all times. Essentially, for every Sugar Sand jet boat that is sold, the company has the opportunity to sell a few additional PFDs. In addition, Sugar Sand has developed a very strong dealer/distributor network to which Execute can pitch its brand to for the first time. This move should also provide the cash and equity necessary to fund further growth through acquisition. How could management possibly pass this deal up? 4. Audited Financials Improving by almost every Conceivable Metric - The improvement to both revenue and gross profit over the trailing three quarters is a direct indication that management has got its act together and is ready to move toward profitability. Operating income improved during the second quarter over the previous reporting period and SG&A expenses stayed flat despite substantial revenue growth (44%). Simply put, the corporate re- organization was a smashing success and the company is much more operationally efficient now than it was just one year ago. I expect upcoming financials to bring more of the same improvement, but only time will tell. 5. Product Placement & Brand Recognition Have Never Been Better - With Kawasaki re-ordering, Execute products being prominently featured on major television outlets including MTV, ESPN, and the E channel, and the company's all-star sales team introducing its revamped 2008 line at the world's largest water sports expo recently, product placement and brand recognition have never been better. This bodes extremely well for future growth as the world is just getting their first taste of Execute Sports products.  Execute Sports Inc. keeps getting more attractive. Financial or revenue news is always a good jump start for EXCS stock but I think this little company is just getting started. Take, for instance, a look at the OTC Bulletin Board for companies currently trading in the $.02 range. Measure them against Execute's recent performance, its strong sales and revenue increase through 2007 and you will see why we like to call this one our diamond in the rough. I suggest watching this one closely over the next few months as the Sugar Sand segment becomes more integrated into Execute's daily operations, financials are released, and business as usual continues. It may take a while for the affects of the increased orders to be seen in the market, but EXCS is building a strong foundation for an explosive 2008.
Traders - We are looking for a similar performance from EXCS as we saw yesterday with NIHK. Labels: Breakout, Dick's Sporting Goods, ESPN, EXCS, Execute Sports, Joe's Outdoors, Kawasaki, MC Sports., Modell's, MTV, Nighthawk, Nighthawk Systems, NIHK, Sport Chalet, The Sports Authority
MMIO Leads with LEED Certification
 Years ago, automakers had to ask themselves a very difficult question…would the average consumer seek out an environmentally friendly automobile even if it came at a large premium? The industry knew the inevitability of the government, at some point, increasing environmental standards. But in the meantime, was it corporate suicide to be an industry front runner? After all, it would be far more costly to manufacture alternative energy vehicles and if the market was not ready for it, car companies may very well have another Ford Thunderbird - the revamped version on their hands. Which Forbes stated was a halo car that turned into an embarassment. Not pretty for public relations. Strategically, an alternative energy car could improve the company’s reputation as a moral and forward thinking corporate citizen. But would a better reputation increase sales enough to make an innovational move like this pay off? All too often, the market is not ready for a necessary shift. Companies that blaze the trail are sometimes eaten alive. For instance, the fully electric car was not only a hard sell but in the end a near flop. The hybrid car was a risky move but a little more palatable to a market that is slow to change. However, consumers have proved that will gladly pay the extra buck to do their part for a greener world. When I think about the road traveled and the road ahead for car makers (especially when paralleled with an Indian car maker market producing Tata’s new $2500 car that can effortless maneuver into even the smallest parking spot – today’s version of the VW Bug). , I think about how other industries are reacting to changes that would create a more environmentally sensitive product. The LEED certification process is one such subject. Defined in Wikipedia as Leadership in Energy and Environmental Design, the certification is not only a new trend for a greener planet but comes with bragging rights for bolstering corporate image. Although the LEED certification process is more costly than general construction and costs are recouped slowly, corporate initiatives to seek out the certification is definitely a fine example of societal responsibility. But is the market ready to pay the extra buck for a greener, cleaner office? After all, do office tenants really care that their office space gets solar energy or was built with non-toxic glue? The LEED certification is a new buzzword for us since Marmion Industries ( OTCBB: MMIO) recently announced their innovative involvement in LEED certification construction. While not as cutting edge as the electric car, a LEED certification is a niche MMIO has not taken lightly. They are one of the first in their area to be certified and have essentially monopolized the market of clients seeking the new green standards. According to a recent article in the San Diego Union Tribune, the LEED certification process is a big hit with larger companies. Tenants are not only willing to pay higher rents for LEED certified buildings, they are actually seeking them out. Marmion Industries has their market cornered and with this buzzword getting more and more play, MMIO stands to be one of the front runners initiating a shift that is necessary and that the market finally seems ready for.
Yahoo Finance Users Bullish on Nighthawk Systems Inc - NIHK
Nighthawk Expands Revenues - Focus
 Nighthawk Systems Inc. (OTCBB: NIHK) filed an 8K after market on Friday and a press release this morning that holds the potential to increase revenues by $6,000,000 over the next twelve months and transform the company into a much larger M2M industry player, as well as open many cross-marketing doors. In a move that helps NIHK build the critical mass necessary to successfully target larger deals and also reach profitability, the company has agreed to acquire the IPTV Set-Top box business from Eagle Broadband. For those of you unfamiliar with the IPTV acronym, our friends from Wikipedia will clear things up for you: http://en.wikipedi a.org/wiki/Iptv "IPTV (Internet Protocol Television) is a system where a digital television service is delivered by using Internet Protocol over a network infrastructure, which may include delivery by a broadband connection. A general definition of IPTV is television content that, instead of being delivered through traditional broadcast and cable formats, is received by the viewer through the technologies used for computer networks.
For residential users, IPTV is often provided in conjunction with Video on Demand and may be bundled with Internet services such as Web access and VoIP. The commercial bundling of IPTV, VoIP and Internet access is referred to as "Triple Play" service (adding mobility is called "Quadruple Play"). IPTV is typically supplied by a service provider using a closed network infrastructure. This closed network approach is in competition with the delivery of TV content over the public Internet, called Internet Television. In businesses, IPTV may be used to deliver television content over corporate LANs."$6,000,000 Cash Influx With Much Greater PotentialSince I have a pretty deep understanding of what transpired with Eagle's IPTV business over the past 6 months, I have a pretty good idea of the potential that this deal holds for NIHK's future. In terms of overall opportunity added on with the acquisition, Internet Protocol Television ( IPTV) is an industry that is about to explode. More specifically, analysts envision the market to be worth nearly $40 billion by '10 with more than 50 million subscribers. That's all well and good you might say, but what does that mean if the company's products have no traction in key consumer markets. Well have no fear - NIHK already has an ace up their sleeve. Ace in the Hole with New Set-Top Box BusinessPrior to its sale, the boys at Eagle Broadband made some valuable inroads with one of the world's leading hospitality IP solution vendors before the big telecoms could make it to market with a viable offering. Under the terms of the agreement, the company would follow up an initial shipment of 500 units with a $6M contract that was staggered out over 13 months if all went well. If NIHK is able to deliver on this new contract and pave the way for a bigger relationship down the road, the possibilities are very interesting. Based strictly on our estimate of, say, 505,000 hotel rooms under their hospitality customer's umbrella, and at an average selling price of $500 for EAG's set- top boxes (likely a sickeningly discounted); it is safe to assume NIHK experiencing the following revenues at specific penetration rates: 5% penetration = $12,600,000 10% penetration = $25,300,000 15% penetration = $37,900,000
* Please remember that these figures are only estimates and represent only potential revenues derived as a result of a strengthened relationship with its unnamed customer in today's news and do not take into consideration the growth of NIHK's historical business.
This deal is a home run for a number of reasons. Hey, I'd say any acquisition that boosts revenues by more than 600% near-term and holds the potential for 4000% gains down the road is a winner. I'm guessing the market will react favorably off the bat, so dig your heels in and conduct a little due diligence on your own behalf on the IPTV industry, the potential set-top box deal on hand, and the prospects of NIHK's historical business
Labels: IPTV, Nighthawk, Nighthawk Systems, Nighthawk Systems Inc., NIHK, OTCBB: NIHK
Forbes Top 200 Small Companies: Could DWIS Make This List Soon? I Say Yes!
 In the article below, Forbes columnists Jack Gage and Christina Settimi give their take on the top 200 small companies in the U.S.
While these companies may be a jump up from many of the small-cap ventures typically covered on this site, there are some very interesting investment ideas in the write-up nonetheless.http://www.forbes.com/2007/10/11/best-small-companies-biz-07200best-cx_jg_cs_1011smallintro.htmlNotice how favorably Nutrisystem (NasdaqGS:NTRI) is reviewed in this piece. The company is really starting to cash in on the country's diet craze. Although their menu is a few rungs under gourmet on the ladder of taste, I guess if you wanna shed the pounds there needs to be some type of sacrifice. http://www.forbes.com/lists/2007/23/biz_07200best_NutriSystem_CABR.htmlWith the number of "health conscious" and "on-the-go" American consumers growing like crazy, the opportunity widens for other players in the market such as DineWise Inc. (OTCBB: DWIS). The company does more than just serve the diet market, which would likely be an operational kamikaze mission. Instead they target, diet, senior caregiver, diabetic, etc. with a gourmet selection that is admittedly better than anything I can make. Since these guys are building a niche in the under-served sectors, as well as diet, where there is some dough to be made - and are led by a team just as capable as the good folks at Nutrisystem, I think DWIS is a very attractive prospect at current levels. Do yourself a favor, check out the recent financials and business plan. You'll thank me later.
Labels: Dinewise, DineWise Inc., NutriSystem
Rich Getting Richer At a Record Rate
 It's getting tougher for the little guy, seemingly by the day. I took a look at the article below on the Wall St. Journal website. Here's a little taste: "The wealthiest 1% of Americans earned 21.2% of all income in 2005, according to new data from the Internal Revenue Service. That is up sharply from 19% in 2004, and surpasses the previous high of 20.8% set in 2000, at the peak of the previous bull market in stocks." http://online.wsj.com/article/SB119215822413557069.html?mod=hpp_us_whats_newsSince I'm not one of those 1% and the thought of the statistics quoted above give me the willies, I think that the country must begin allocating resources in the proper arenas, particularly education. If something isn't done soon, we could be looking at a some very different U.S. equity markets in another five to ten years. Just a thought, but this issue does have very major implications on all of our futures one way or another.
Cigarettes, Booze and Gambling: Bad For You, Good For Your Portfolio
 Check out this article published yesterday by Morningstar analyst Matthew Reilly:
http://biz.yahoo.com/ms/071010/209103.html?.v=1
Although a nicotine addiction, a hollow leg, and a tendency to blow the weekly paycheck at a poker game or at the casino, the good people who make all of the above for us, although they posses somewhat risky business plans due to various governmental regulations, also provide some nice returns for those willing to, for lack of a better word, gamble.
Labels: Alcohol, Gambling, Tobacco
Investor's Business Daily - Top 10 For Thursday 10/11/07
 In addition to a few of our long-time small cap ideas like Commerce Planet Inc. (OTCBB:CPNE) and Challenger Powerboat Inc. (OTCBB:CPWB) now showing signs that the future may prove to be quite lucrative to those willing to take a gamble at near-bottom levels - a number of company's trading on senior exchanges also warrant a closer look due to their stellar recent performance. Here's Thursday's Top Ten list courtesy of Investors Business Daily. http://biz.yahoo.com/ibd/071011/top10.html?.v=1A diverse portfolio is key to success, so throwing a few of these on the ole watch list may make you a few bucks down the road. Good luck to all. Labels: Challenger, Challenger Powerboat, Commerce Planet, Commerce Planet Inc., CPNE, CPWB
A Chink in VoIP's Armor?
  A co-worker of mine pointed this article from Forbes magazine out to me earlier this week and I found it pretty interesting:  http://www.forbes.com/2007/08/02/voip-security-flaws-tech-internet-cx_ag_0802techvoip.html?partner=daily_newsletter
The bottom line here, which I suppose is no shocker, is that despite how far VoIP has come in terms of its technological development, and despite its cost-effective nature, the technology remains more vulnerable to attacks than traditional circuit-switch technology. If you've used VoIP before, you also realize that the call quality is not quite there yet either. But hey, there's usually always a trade-off when your number one purchasing decision criteria is weighted more towards price rather than quality. And I'm not dissing VoIP, I have a VoIP phone in my office and use it quite a bit. Furthermore, consumers around the world are adopting VoIP at a record clip and it likely will one day be the Supreme method of voice communication. Nobody is perfect and apparently the saying rings true to VoIP as well. So apparently the challenge is on for VoIP providers to fortify their offerings and make them as less susceptible to attack as humanly possible. This could be a make or break situation for many industry players. Labels: VoIP
Marmion Initiatives Have Me Watching
 Following a string of very positive news over the past month, Marmion Industries Corporation (OTCBB: MMIO) updated investors this morning on its recent achievements and outlined a few key goals for the company going forward. http://biz.yahoo.com/prnews/071011/lath046.html?.v=101Putting the company's past market performance and current share price aside for a moment, I'm intrigued by Marmion for a number of reasons: 1. They've announced $5M worth of booked and completed biz over roughly the past 5 weeks. Since they did about $4.6 in revs for all of '06, this is a positive indicator that business is ramping up. 2. The true telltale sign that a company is growing! Marmion recently purchased land is about to break ground on a new facility that will help them meet growing demand for current products and even delve a bit deeper into the OEM business. Not only is this great for sales, it also helps to open the doors to end-users like ConocoPhillips, a current user of Marmion Products 3. Marmion is located in Texas, the largest oil producing state in the U.S., and plans to target customers for the first time rather than relying simply on word of mouth which has got them this far. 4. Management realizes that operational efficiencies can be improved and is making an effort to audit current business processes and implement new quality mandates to ensure the ship is run as tightly as possible. 5. The investment going into the Petrochem industry over the next five to ten years will be enormous, if MMIO can latch on with more of the world's Lucites and Conoco's, going after funding that will take the company to the next level or priming itself for acquisition are both distinct possibilities. Check out this recent article from 9/24/07. It gives you an idea of the investment going on right in Marmion's backyard. http://www.texasgulfcoastonline.com/News/tabid/86/ctl/ArticleView/mid/466/articleId/72/Default.aspxLabels: Marmion Industries, Marmion Industries Corp., MMIO
Executing on High at Surf Expo
 Just as Michael Jordan's appeal spawned Nike's growth to unprecedented levels years ago by adding credibility to the brand and helping the company transition its corporate image into the world's leading supplier of athletic shoes, apparel, and sports equipment; Celeste Berouty, the recently appointed President of Execute Sports Inc. (OTCBB: EXCS), has made all of the right moves in her first year with the company to help establish the Execute brand as a leader in the global water sports industry. On to Surf Expo Although Ms. Berouty's positive impact is already being exhibited by Execute's record sales levels, strengthening margins, prime-time OEM deals, improved distribution channel infrastructure, and product placement on major television outlets; her recent appearance at the annual Surf Expo in Orlando may be her biggest contribution to the company's growth made thus far.
Body Glove to Execute  After 20 years as sales director at industry leader Body Glove Wetsuits, this was not only Ms. Berouty's first time back at a trade show, but her first time back representing her own company. What better a time for her to rub elbows with her vast network of contacts than at the biggest water sports event of the year while Execute unveils its completely revamped 2008 product line? The Surf Expo is the biggest show of the year for the water sports industry and is attended by the vast majority of leading players, both domestic and international; including all major retailers, manufacturers, distributors, marketers, and of course consumers. With management stating in today's release that the show was a smashing success and that their exhibition booth was swarmed the entire time while more meetings were conducted than ever before, I'd say that it's not out of line to expect one or more of the following events to occur in the not so distant future: Another Kawasaki-esque OEM agreement. Repeat orders from existing retail customers and initial orders from retail organizations not already carrying Execute Sports gear. The formation of a distribution agreement, possibly with international focus, that helps to expand the company's geographic reach and revenue base. Kick off of a new advertising/marketing program that builds recognition for the new and improved '08 product line. Announcement of a strategic partnership or acquisition that further positions the company for stronger future growth. Stock Primed For a Pop - Management Executing on All Outlined Initiatives EXCS has been filling the presses with positive news since mid-April and announcements stemming from the recent Surf Expo have given investors new confidence. Couple that with upcoming news regarding the newly acquired Sugar Sand business, its affect on the continued success of Execute's water sports segment, and we should see some promising things from the company's books as well as from its stock price. The stock made a valiant run back in January and with the company's product rising in popularity, not to mention free exposure, connections in the industry being made and strengthened by the day and a new captain at the helm, we can't help but think we are seeing history in the making for this sometimes struggling diamond in the rough. Here is my thought process. . . For starters, investors involved in this deal seem to be head over heals in love with good news, and we're not just talking numbers here. Name dropping has proven to be just as effective, if not more, of a market mover than financial improvement. Sometimes the market just doesn't make sense. For example, after trading in the two cent range - roughly where we're at today - since November of 2006, shares surged up 50% on January 17, 2006 on news that water sports sales were up over 150%. Two days later, on news of an agreement with Kawasaki, shares doubled again, hitting a high of $.09 that day and closing at $.08 on volume that exceeded 22 million. After that, share price held relatively steady although it dipped a bit down into the $.06 range. And then . . . . . Total darkness! After divesting the Academy brand, Execute went back to the drawing board from an operational perspective - a move that is paying off nicely now as business processes improve - but wreaked havoc on market price as shares went into free-fall mode for nearly two months while zero corporate announcements were released. After that, not even a $5M acquisition could get this thing moving upward from current support levels. Simply put, the lack of corporate communication, whether warranted or not, killed the rally. Q3 Release Just Around the Corner
 Thankfully for all, it looks like EXCS's dark ages have finally reached their renaissance. If things continue the way they are and Celeste continues to utilize her extensive industry contacts in ways as productive as the Surf Expo, we should see more positive news out of EXCS over the next few months. Ideally, an optimal mix of releases that both highlight further operational advancement such as the recently reported 40% improvement in online sales as well as the inroads being made with manufacturers, retailers, distributors, marketers, etc., that stand to significantly improve financial performance will encourage the market to put their faith EXCS. Given the fact that the summer months are the strongest of the year for overall water sports sales as well as exceptional months historically for Execute, the Q, which should be out soon, ought to be a good one. In addition, I'd bet my dollar to your dime that Celeste and the crew came out of the aforementioned Surf Expo with at least one big name business associate. Long-term investors are smiling already. What is also clear is that there are a lot of eyes on EXCS. The stock has found support at current levels time and again and should react positively to a string of stellar news as it has historically done. The market also has to price in the future value of the company sooner or later, which has been increased exponentially by the recent Sugar Sand purchase. Having the boat company under the Execute umbrella provides a much needed cash influx as well as a world of new opportunities for more positive press and complementary water sports product sales. However, Sugar Sand aside, the overall progress being made on behalf of Exectue's thriving water sports business and its future potential is reason enough in my opinion to warrant consideration for higher market value. With lesser news, the stock returned some pretty hefty gains a few months back. The company's foundation and prospects for future growth was significantly weaker than it is today. As the company continues to trudge along improving its revenues and prospects, we expect great things from Execute's future. Labels: EXCS, Execute Sports, Execute Sports Inc.
US Energy Approaches Profitability
 As we all know, innovation often comes slowly - and at a price. It is common practice for pharmaceutical companies to spend millions of dollars on research and development, only to find that their product cannot perform as projected or that FDA approval is not in the cards. The alternative energy industry - much like the pharmaceutical world - may try for years to get their product from blue prints to the assembly line. For instance, it took eleven years for US Energy Initiatives Corporation (OTCBB: USEI) to make the jump from R&D house to manufacturer. While the industry can be considered a speculative one, US Energy's final transition to production may very well launch it from it's place among a sea of companies with a great idea that may never materialize to the avante garde world of innovation in motion. The Next Level . . .Announcing this morning that management has eliminated approximately $4M worth of expenses from the books while increasing its revenue run rate to nearly $5M (both on annualized basis), US Energy appears to be embarking on a new era of expansion. Now further diversifying itself into the $266B computer and electronics manufacturing and $13B chemical product and preparation manufacturing industries through both internal expansion and growth through acquisition, US Energy is developing a perfect compliment to its high-potential dual-fuel system segment which is now ready for wide spread implementation. The way I see it, for a company that has logged trailing twelve month revenues of nearly $1.6M with an average net income over the same period of about - $2.6M; today's news should viewed as a very bullish indicator of future performance. Ready to Reap the Rewards of Hard WorkWith the company's dual-fuel technology now ready for mass commercialization after years of capital investment and heavy interest amongst the who's who of the global automotive industry, USEI management is now rolling up their sleeves and pursuing business opportunities that hold the potential to strengthen margins, improve revenues, and provide capital to fund future technology development. Now USEI could very well sit by idly and wait for its patented Dual-Fuel systems to ship. This in itself could prove to be quite lucrative considering the the past string of contracts and agreements in place with leading auto industry players which include a $54M, 5- year contract for the conversion of busses in Thailand, a formal contract for the C190 Colorado Pick-Up program with GM Thailand, and participation in a conversion program with China's second-largest truck OEM. However, USEI is dedicated to making the company a profitable and diverse manufacturing organization. And waiting was not making money. So the bottom line here is this: back in '05, the company saw the value in dedicating its resources towards pursuing large-scale contracts with major automotive OEMs and perfecting its dual-fuel system for wide-scale commercialization. The company's technology has been fully validated and it now expects to reap the rewards of all of its blood, sweat, and tears. Growth Simplified Through Diversification If you've taken USEI off of your radar screen over the past six months, we feel that you are justified in your actions, particularly since the stock has performed horribly. However, the previous focus on perfecting the company's patented dual-fuel diesel engine technology by any means necessary, namely dilution and other forms of corporate debt, is now in the rear view mirror. With the company's dual-fuel technology fully- developed and deemed ready for sale in the Asia- Pacific region by General Motors Thailand, USEI is now moving forward with the second stage of their growth strategy. This encompasses both the expansion of the company's Automated Engineering Corporation business segment, which was acquired back in June of 2006 and now carries with it a $500,000 backlog; as well as growth through acquisition which was achieved by the recent buyout of Advanced Aerosol (formerly SeaSpray), which also boats a $500,000 backlog The "new" company, which management has proposed to call Advanced Technology Solutions, is comprised of three business segments: Electronic Manufacturing - Automated Engineering Corporation (AEC) is an ISO 9001 certified electronics manufacturer that has been in business for nearly 20 years. By acting as a contract based producer and developing products only once client demand is present, AEC is able to maximize efficiencies by accurately predicting its demand for raw materials and financial resources. With a current product backlog of $500,000, AEC accounts for approximately 60% of total revenues and 12% of expenses. Aerosol Production and Packaging - Advanced Aerosol (formerly SeaSpray): Produces and distributes aerosol-delivered janitorial and industrial products, waxes, lubricants, and polishes for both private label and corporate brands. From the paint on NFL fields to Buck Bomb hunting scent, SeaSpray comes to market with a portfolio of 750 unique chemical formulations. Dual-Fuel System - Formerly accounting for 93% of expenses and only 4% of revenues, this portion of the business now contributes to 2% of overall revenues and 61% of expenses after the recent acquisition of Advanced Aerosol. Upon receiving approval from GM Thailand, US Energy made the executive decision to move from technology development to the manufacturing of the final system. From The Horse's Mouth . . .With the final system now in place, I began to reasses the company considering it's new method of operation. After a pretty in-depth review of US Energy's recent string of press, I thought that the quote below from CEO Phil Rappa was an excellent re-cap of its direction and recent activities. Check it out. "Eliminating expenses and acquiring a revenue- generating business segment places the Company in a strong position to achieve near-term revenues and profitability. With the acquisition of SeaSpray and eliminating substantial expenses, we have now completed the first major component of our corporate reorganization. While we remain committed to realize a return on our capital and time invested with the dual- fuel technology, achieving financial and operating stability requires that we complement our development efforts with time-tested revenue opportunities. Boutique electronic manufacturing and specialized aerosol packaging coupled with a family of sole-source products strengthens our ability to achieve profitable operations. Using a platform of stability, we can pursue technology development as opportunities become available."With the company's annual run rate on pace to trump 2006 revenues by nearly 260%, expenses falling drastically, back into a comfortable range (operating expenses for the 1st six months of '07 are down 31%), and a diverse selection of potentially lucrative opportunities at its doorstep, I think that US Energy Initiatives Corporation deserves another look from familiar parties and some solid due diligence on behalf of all you first-timers. Labels: General Motors, GM, US Energy, US Energy Inititatives, USEI
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The most recent report out of the U.S. Commerce Department provides the market with a much needed morale boost, stating that our economy experienced its fastest growth - 3.9% - in 1.5 years during the July-September quarter.
