Jason Williams (Pristines4)
Member
Username: Pristines4
Post Number: 379
Registered: 12-2002
| | Posted on Thursday, June 12, 2003 - 9:48 am: | |
Anyone heard anything about this company?
I just got an email from on online stock watching group and they recommended a buy. Just curious if anyone else has heard anything. Here's some of the info I received in the email:
-$40 Billion Dollar PEO Industry
-25% Annual Industry Growth
-CSRV currently has 860 Clients with 32,000 workplace employees, operating in 32 States
-CSRV�s Current Gross Volume of $600 Million Dollars is less than 2% Market Penetrated
-CSRV generated $40.4 Million Dollars in Revenues in 2002 versus $13.7 Million in 2001
-CSRV earned $2.99 Million Dollars or $0.51 per diluted share in 2002 versus a net loss of $0.734 Million or ($0.21) per share in 2001
-Taglich Brothers a Member of the NASD JUST RECOMMENDED CSRV WITH A TARGET PRICE $2.25 PER SHARE
-Taglich Brothers is Estimating Revenues for This Year of $56.7 Million Dollars & $65 Million Dollars for Next Year (which DOES NOT include StaffAmerica)
-Taglich Brothers is Estimating Earnings of $3.9 Million Dollars This Year & $4.9 Million Dollars Next Year
-CSRV Currently Trades in the Market at about 2 TIMES This Years EPS Estimates by Taglich Compared to its Peer Group of 17.5 Times EPS
-CSRV Expects to Close the StaffAmerica Acquisition ANY DAY�PR PENDING
-StaffAmerica Will Add 1,000 Clients with 30,000 Worksite Employees
-StaffAmerica Should Add an ADDITIONAL $40 MILLION DOLLARS IN REVENUES & ADDITIONAL PROFITS to CSRV NOT Factored in Taglich�s Report
"It appears to us that a Full Service Brokerage Firm by the name of Taglich Brothers RECOMMENDED CSRV with a $2.25 TARGET PRICE.
Taglich Brothers claims to focus exclusively on Micro Cap Companies. To further our due diligence on Taglich, they too claim to get paid to write reports. Our understanding of Taglich is that they write the reports and then hand them over to their clients to do what they want with the reports (generally attempt to disseminate it).
Bingo, this is where we come into the picture we get paid to advertise our clients business and PR to our membership.
Taglich Brothers, in our opinion, has put together a rather detailed report on CSRV.
For the year ending Dec 2002, CSRV reported $40.4 Million in Revenues up from $13.7 for 2001, and Net Income of $2.99 Million up from a loss of $0.734 in 2001.
Taglich this year (for 2003) is estimating CSRV to generate $56.7 Million in Revenues, and $65 Million for 2004 and EPS of $0.46 this year and $0.57 for 2004.
THESE PROJECTIONS DO NOT INCLUDE THE PENDING ACQUISITION OF STAFFAMERICA, WHICH SHOULD ADD AN ADDITIONAL $40 MILLION IN REVENUES TO CSRV. THIS ACQUISITION IS EXPECTED TO CLOSE ANY DAY.
THE FOLLOWING IS AN EXCERPT OF TAGLICH�S BASIS FOR A $2.25 TARGET PRICE FOR CSRV.
�We are initiating coverage of Certified Services, Inc., with a Speculative Buy recommendation and a twelve-month price target of $2.25 per share, based on our sales and earnings per share estimates for 2003. It is our belief that the Company will generate revenues of $6.63 per share and post earnings of $0.44 per share.
We have established a twelve-month price target of $2.25 per share based on averaging the two valuation models (see below) and utilizing a discount factor of 60%. Our discount factor incorporates microcap risk, the current stock market environment ��
�Valuation models:
_A 18.5X P/E multiple based on the average of the Company�s peer group earnings multiples
(�03, 04) applied to our earnings per share estimate of $0.48 for the next four quarters; and
_A 0.37X price to sales multiple based on the Company�s trailing twelve month peer group average, applied to our revenue per share estimate of $6.88 for the next four quarters.�
Another way to look at what CSRV could potentially be worth Near Term, is by taking a look at CSRV�s most recent 10Q dated 3/31/03.
By looking at CSRV�s Balance Sheet we noticed almost $50 Million Dollars in Assets and about $26.5 Million in Liabilities, with Shareholders Equity of $23.5 Million Dollars or almost $2.75 Per Share!"
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