Get Trade Alerts

Signup for Free Email List!

Enter your Email

Preview | Powered by FeedBlitz
To subscribe to the Super Stocks Blog by RSS feeder click on :

Subscribe to: Posts (Atom)

Wednesday, March 20, 2013

MTSL Dip Is A Buying Opportunity

MER Telemanagement Solutions Ltd. (NASDAQ Capital Market: MTSL), a global provider of Mobile Virtual Network Enabler (MVNE), Mobile Money and telecommunications expense management (TEM) solutions and services, yesterday announced its financial results for the fourth quarter and the year ended December 31, 2012.

For the quarter MTSL did $0.20 EPS for the quarter. This represents a run rate of $0.80 EPS on an annualized basis. The Company has grown operating income 410% in 2012 over 2011.

The also announced that their largest customer will not renew in 2014. The market, in my opinion, greatly over-reacted to this fact. While this represents a material amount of revenue at approximately 25%, there are several mitigating factors. If MTSL were not to grow revenues at all in 2013, they would have an EPS run rate of $0.80. If nothing changed then in 2014 they would have an EPS run rate of $0.60. However they have told us in the press release that they are diligently working to take advantage of new opportunities and sign new contracts. MTSL has all of 2013 to replace the lost revenue from this contract.

They are entering into new growth areas like Mobile banking. They are the leader in servicing the growing mobile virtual network industry. This is a cloud based software company that provides ROI to the users of their software. All of these areas typcially generate P/E's of 10+.

Two similar companies are Tangoe Inc. (TNGO) and Veramark Technologies Inc. (VERA). VERA just reported $0.07 EPS for the year and trades at a 10 PE. TNGO will do approxiamtely $0.70 EPS for the year and trades at a PE of 17.

So at a minimum, if you took an unrealistic conservative approach and did not think MTSL will grow anymore, than at a 10 PE on the $0.60 2014 EPS this should be a $6 stock. As MTSL signs new business and replaces the lost revenue, they will grow EPS back to the $0.80+ range and deserve an even higher valuation. I believe this stock will bounce back to the $4-$6 range as these facts are realized and short sellers cover.

The markets over-reaction to the MTSL announcement presents an opportunity to participate in the rebound once these numbers are realized and as MTSL coninues to sign new contracts.

No comments:

DISCLAIMER is simply a blog that has information on stocks that the author Superman, likes or may trade. The author may, and usually does have positions in some of the stocks discussed on the site or in email alerts and is under no obligation to disclose the size of the position or the time that it was acquired. The author also reserves the right to buy or sell at ANY time before during or after it is mentioned on this site or an email alert, with no notice or warnings. The posts are not at all intended to be recommendations for anyone else to buy, sell, or hold. Investors should not rely on the information given by this site to make investment decisions.

No contributor of the his site is a registered investment advisor or a broker / dealer. We DO NOT recommend whether to buy, sell, or hold securities . Although we believe the information on this site to be accurate, we DO NOT GUARANTEE the accurateness and completeness of statements made regarding stocks discussed on the site or in email alerts.

The performance section provides information to the public on selected stocks profiled by this site. Past performance should not be used as an indicator of future performances. We try the make the past performance section as accurate as possible but DO NOT GUARANTEE that the information is accurate.

This web site and all email alerts sent by this site contain "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21B of the Securities Exchange Act of 1934. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, goals, assumptions or future events or performance are not statements of historical fact and may be "forward looking statements." Forward looking statements are based on expectations, estimates and projections at the time the statements are made that involve a number of risks and uncertainties which could cause actual results or events to differ materially from those presently anticipated. Forward looking statements in this action may be identified through the use of words such as "expects", "will," "anticipates," "estimates," believes," or statements indicating certain actions "may," "could," or "might" occur.

If any part of this disclaimer is not clear, please take the time to consult an attorney or investment specialist. Please take caution in all investment endeavors and good luck to all.

Again, My messages are not investment advice, investment solicitation or the like. Do not take action based on my messages. I do not guarantee or make claims to the accuracy of anything I post. I may buy or sell any securities I mention at anytime, even prior to posting. It is my opinion, that individuals should perform their own due diligence before investing in any stock at anytime and not base decisions on messages posted by other individuals. Individuals should assume 100% responsibility for their own investing. My messages are for my own entertainment only. LOW FLOAT stocks in particular can be volatile and are not for new traders in my opinion. I am not a registered investment advisor in any shape or form, please do not ask me for ANY investment advice.

Welcome to, blog home of Superman. Purpose of this blog is for me to discuss my trades and stock ideas (As well as opinions and rants on stock market related issues). I will mention the date and price I enter. As far as exits, I always try to take half off when I have some profit and if I believe in the stock, let the rest run further. I always also use mental stop limits, at which time I would exit and minimize any losses. I do not like to give price targets unless I can support them by P/E in some way or by comparison to another stock. I just post stock trades and ideas that I believe will go higher (or lower for shorts) and the reason I believe that. Individuals should have their own strategies for managing profits and losses. My stock picks tend to NOT be daytrades at all and many take time to move. I am not an investment advisor and this blog should not be considered or followed as investment advice.