Perla Group International Inc (PERL)

[sweet crude]

PERL Issued .07 to .10 Price Target

Perla Group (PERL) Issued Price Target of .07 to .10 per share
Last Updated: March 20, 2012 - 8:55am EST

(NEW YORK)--Ludlow Capital, an equity research firm based in New York City, initiated research opinion on Perla Group International Inc. (Pink:PERL), a leader in the international military, police and security solutions sectors, with a price target of $0.07 to $0.10 per share.

Military Contracts

Perla Group is a global provider of military, police, and security products. The three main divisions in the company are Perla Aviation, Perla Armored Cars, and Perla K-9 Services. The Company has contracts with US military contractors, and the United Nations for armored vehicles, and other turnkey security and military equipment. As many experienced traders know having contracts with either the US or national militaries is the holy-grail for any company.

The Company just recently announced a $665,000 armored car contract, and is set to see even higher revenues from their aviation division, which recently closed a $1.8 million contract with a luxury Yacht company in November 2011.

Shares Outstanding Reduced

The Company recently reduced its outstanding shares from 484 million to a current estimate of 224 million shares, which is represented by 2582 shareholders.

Company Earnings

For the nine months ending Sept 30, 2011, the company reported revenues of $2,746,475, and net income profit of $843,049. According to their filings the company has little to no debt, and had around $250,000+ cash in the bank, which makes for the prospects of any dilutive debentures less likely.

EPS Estimates

If you divided their $843,049 net income by the 224 million shares currently outstanding, you get a rough EPS estimate of around $0.004 per share. Based on a conservative PE of 10 PERL should already be trading at a price of $0.04 per share, This does not take into account the company's fourth quarter earnings, which are expected to be released to the market within the next week or so.

Giving the execution of new contracts, and strong earnings performance through 2011, it could be estimated that PERL could have an EPS for fiscal year 2011 in the range of $0.005 per share. Based on the current share structure, and at a trailing PE of 10, that would give PERL a minimum target of $0.05 per share. But, this is only on a trailing bases, and with a $1.8 million contract just coming into effect, and a $665,000 armored car contract in the month of February, and possible reverse merger/acquisition in their aviation division, the company is already on rack for a strong performance for 2012.

Price Target

Thus, on a forward bases, we have come to our estimate based on a forward PE on 2011 fiscal year end results on a 14 to 20 times earnings, which would give PERL a price target, based on projected fiscal 2011 EPS of $0.005, in the range of $0.07 to $0.10 per share.

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