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WOLV: Bargain of 2006 for LOGICAL investors:
The stock market is never perfectly efficient or logical. At times, equity values fall to a fraction of the true worth of an enterprise. On October 2, 2002, Sonus Networks traded for 18 cents. It subsequently rose over $10.
WOLV is another example of a stock that is trading at a FRACTION of its intrinsic value for no logical reason. WOLV is trading at a Price/Sales ratio of 0.14 compared to the Indusry average of 2:
http://finance.yahoo.com/q/co?s=WOLV.OB
As I have said in previous posts, this valuation reflects a perfect storm of extraneous factors: NASDAQ delisting and a brutal small cap bear market. There is NO justification for WOLV to be trading at such depressed levels, WOLV's financial and operating performance are the best in years:
Financial: WOLV completed a $1 million financing in April. After this financing, WOLV has POSITIVE WORKING CAPITAL (current assets of $7.8 MM and liabilities of $7.6 MM) and only $1 million in long term debt. This balance sheet is better than 90% of OTC companies!!
Operating:
1) The third quarter 2006 financials show WOLV is on the road to sustained cash flow and profitability. Costs were reduced by 27%, and net loss was reduced by 40% to $486,000. If depreciation and amortization are added back, WOLV was essentially cash flow breakeven for the entire quarter.
2) IN THE MAY CONFERENCE CALL THE WOLV CEO STATED WOLV'S SALES PIPELINE IS THE STRONGEST IN HISTORY. Consequently, the trend to improved cah flow and GAAP profitability will continue.
Conclusion: WOLV is a rare opprotunity: A stock trading at huge discounts to the sector. There is no company specific reason for this huge discount. WOLV has a aound balance sheet, positive working capital, minimal debt, is essentially cash flow breakeven moving to cash flow positive, and has the strongest sales pipeline in the company's history.
When assessing WOLV as a potential investment focus on WOLV's fundemantals, not the BASHER TRASH.
WOLV IS A BUY AND WILL REWARD PATIENT INVESTORS.
UPDATED WOLV DD SUMMARY JUNE 30 2006
The share price of WOLV:NASDAQ has been impacted by extraneous, non business factors- a severe small cap bear market and the NASDAQ delisting. As summarized below WOLV is now in the best operational and financial condition in years, and the current price provides an incredible investment opportunity.
NetWolves Corporation (WOLV) provides network security solutions coupled with network management and communication services worldwide. It operates in three segments: Voice Services, Managed Service Charges, and Equipment and Consulting.
WOLV met all NASDAQ requirements except the bid price, so was delisted on May 16, 2006 and now trades on the OTC BB.
WOLV is a turnaround story. After losing its major customer, Swift, WOLV took quick action to slash costs and diversify its customer base. The end result is that WOLV is now a more diversified, streamlined company than ever. With nearly $2 MM in annual cost reductions, WOLV turned cash flow positive in March 2006:
http://biz.yahoo.com/bw/060222/20060222006065.html?.v=1
It is interesting to note that the last time WOLV was cash flow positive, in early 2005, the share price exceeded $1.
The third quarter 2006 financials show WOLV is on the road to sustained cash flow and profitability. Costs were reduced by 27%, and net loss was reduced by 40% to $486,000. If depreciation and amortization are added back, WOLV was essentially cash flow breakeven for the entire quarter, but as noted, turned the corner to positive cash flow in March 2006.
http://biz.yahoo.com/bw/060518/20060518005875.
html?.
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IN THE MAY CONFERENCE CALL THE WOLV CEO STATED WOLV'S SALES PIPELINE IS THE STRONGEST IN HISTORY.
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As of May 19,2006, WOLV has a market capitalization of $7.5 million and a Price/Sales rato of 0.3. This is a significant discount to the Industry average Price/Sales ratio of 2.6:
http://finance.yahoo.com/q/co?s=WGRD
With the recent $1 Million financing, WOLV is now in EXCELLENT financial condition. WOLV has positive net working capital and only around $1 million long term debt.
WOLV has many large Fortune 500 clients including General Electric and McLane, a wholly owned subsidiary of Berkshire Hathaway Inc. WOLV has significantly increased its sales pipeline and diversified its customer base through a new marketing strategy that increases the company's sales reach:
http://www.thechannelinsider.com/article2/0,1895,1928373,00.asp
WOLV also provides VOIP services. With the Vonage IPO in May, WOLV could benefot from the interest in the sector.
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OS AND FLOAT
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As of 05/19/2006:
31,774,479 shares outstanding and approximately 27.4 million float. WOLV management owns 6,895,000 shares.
On conclusion, WOLV represents a compelling investment opportunity: A cash flow positive stock with GAAP profitability in sight with a relatively low share count trading at a huge discount to its peers. The disconnect between WOLV's performance and the share price WILL NOT LAST.
15 POSITIVE WOLV 2006 ACCOMPLISHMENTS
WOLV's accomplishments in the last year have been OVERWHELMINGLY POSITIVE.
1)Expanded service Agreement with one of Largest customers, Mclane (Berkshire Hathaway subsisdiary
2)Renewed General Electric contract (May conference Call)
3)Added 2 significant large energy and travel sector customers
4)After removing impact of losing Swift Transportation, Increased Q3 sales revenue 10% from $4.9 million to $5.3 million
5)10% increase in Managed Service revenue- the future growth driver of WOLV
6)Achieved largest sales pipeline in WOLV history (May conference call)
7)Achieved POSITIVE CASH FLOW in March (May conference call)
8)Added a number of new sales channel partners contributing to many contract wins
9)Reduced operating costs by 27%
10)Raised $900,000 in new financing.
11)Reduced Q3 2006 loss by 30% from $740 K to $480 K
12)Added over 300 customers in higher education market.
13)Added 2 high profile directors with significant experience: Gerald A. Gagliardi, former Sr. Vice President, Worldwide Customer Services of NCR Corporation, and Michael R. Rocque, President of Leading Strategies, Inc and Retired Lieutenant Colonel in the US Army.
14)WOLV STATED IN MAY CONFERENCE CALL SUSUTAINED POSITIVE CASH FLOW EXPECTED WHEN THE 2 NEW LARGE ENERGY AND TARVEL SECTOR CUSTOMERS ARE FULLY OPERATIONAL
15)Achieved listing on OTC BB after being on Pink Sheets.
Yes I have the same questions... 1 MM = manipulation.
Here's a legitimate question.....
since the move to the OTCBB there is only one market maker making a market in this stock, anyone want to take a guess as to why? I personally have no idea. Also I am unable to find an answer as to why there is no bid / ask being shown. Otherwise IMHO this stock is very undervalued.
MM is SEABOARD SECURITIES, INC.
http://www.otcbb.com/profiles/wolv.htm
Cheers
CASH FLOW POSITIVE: In the CC WOLV indicated once the travel and energy new customers are fully serviced
CASH FLOW POSITIVE.
WOLV: Strongest sales Pipeline in HISTORY
From Conference call
Be patient the market is horrible. $1 by Xmas.
Price way to cheap. Huge potential at this price. Not sure why the decline today.
Why isn't WOLV higher than CDSS?
CDSS
At March 31, 2006 the Company had cash and cash equivalents of approximately $3.8 million, a net working capital deficiency of approximately $5.2 million and a stockholders’ equity deficit of approximately $1.4 million. In addition, cash provided by operating activities in the first three months of 2006 totaled approximately $3.6 million; however, the Company incurred a first quarter 2006 net loss of approximately $892 thousand.
The Company reported approximately $3.6 million of cash flows provided by operating activities; and after cash expenditures of approximately $520,000 for capitalized software development costs , and net repayments of approximately $602,000 related to amounts borrowed against accounts receivable and advances from an officer, the result was a total increase in cash of approximately $2.4 million during the first quarter of 2006. As a result of this increase in cash, no debt or equity financings were deemed necessary by the Company, other than short-term borrowings against accounts receivable. Historically the Company has had access to additional capital and has raised money through both equity and debt financings, including borrowings against accounts receivable, preferred stock private placements, and advances from the Company's CEO. The Company believes that it has adequate access to capital and that it will continue to have access to capital to fund the operations however, the Company has no plans as of the filing date of this report to raise additional funds. In addition, the Company's CEO has committed to advance the Company up to three million dollars in funding should it be necessary for short term working capital needs through March 2007. The terms and conditions of any advance to the Company from the CEO will be established by the Company's Board of Directors. The CEO advanced approximately $475,000 to the Company during the first quarter of 2006 of which approximately $322,000 remained outstanding at March 31, 2006 and was repaid in April 2006.
The Company believes that the execution of its business plan including strategies to grow revenue and control costs and expenses, combined with liquidity available from our Factoring Agreement and the commitment from the Company's CEO, is sufficient to fund operations for the next twelve months. If needed, Citadel may also consider raising additional debt or equity capital under the right circumstances. However, there can be no assurance that the Company will be able to raise debt or equity capital at terms it considers reasonable and prudent or that the Company will be able to fully execute its business plan in 2006.
Will bid ask be quoted publicly on Yahoo? I thought all OTC BB's had public quotation on bid ask
Thanks, froma knowledgeable Canadian more familar with Canadian market info.
http://www.otcbb.com/asp/dailylist_detail.asp?d=06/02/2006&mkt_ctg=OTCBB
I would think knowledgeable investors would all know of this site.
Cheers
Please provide link or otherwise confirming Monday OTC listing
WOLV Will EXPLODE with pending OTC listing like GEECF. GEECF went from $.15 -> $.59 in two days after listing on OTC http://finance.yahoo.com/q/pr?s=GEECF.OB
LOL, you just had to use one of his most useless posts like that one, rather than one that did provide a little information and leads to look into.
What do you think of my concerns?
I saw your post about CDSS. Is that not the exact same concern here? Why does CDSS bring in such higher valuation at this time? I've seen info posted about CDSS but have not looked into it much. Sounds so much like WOLV, I just don't know why its share price is so much higher. Seems like both of them should be trading down here in the teens to low .20s.
No good company though. Concern is that current assets is less than liabilities
SBC, the YAHOO board was sterilized for 3 years by a malicous, totally one sided basher who used every trick in the book. Consequently I will err on the side of caution to make sure bashing does not take place. Bashing is one sided, unreasonable, repetitive and misleading. That won't be tolerated here. Following is an example of the totally misleading crap we had to put up with 3 years.
I won't comment on this issue further only factual pertinent posts please.
JIR:
UPDATE
I like to follow "interesting companies".
Here is the list of companies:
WOLV
DCTC
CCEE/DIRI
ROTI
CRZN
RMIL
TVCP
LCST
where I have warned the victims about what the HYPERS & DUPERS were doing to them. Isn't it interesting that many of the same HYPERS & DUPERS are also here?
WOLV is now delisted and seems headed for WOLV.PK
DCTC is now called DCTC.PK, it has no true value or message board.
CCEE/DIRI is now called DIRI.OB it has little value, and no message board.
ROTI is not a valid ticker symbol. any more
CRZN is not a valid ticker symbol. any more
RMIL is now called RMIL.PK it has no true value or message board.
TVCP is not a valid ticker symbol. any more
LCST is now called LCST.PK,it has no true value or message board.
When you are HYPED & DUPED
Voluntary Disclosure: Should be made to
John Reed Stark
Chief, Office of Internet Enforcement
United States Securities & Exchange commission
enforcement@sec.gov
Does anyone have a current customer list for NetWolves?
They said on the CC that they had about a 5% attrition rate of old customers, but I do not know how fast they are replacing those lost customers, if at all.
I think I need to listen to the CC again, if I can find the number.
Problem is
I learned more aout the challenges Netwolves faces from those negative posters than I did any of the positive posters. They gave me information about issues to focus on to see how well the managment addressed certain concerns. I asked a few questions on the CC to get answers direct from managment on issues that those negative posters posted about, and I was glad to have the leads to get to those concerns. As far as their answers, I was OK, not totally happy, with managements' answers, but at least I know some areas to be looking into, THANKS TO THE "BASHERS".
I feel at a great disadvantage not having someone pushing me to look at areas that put this investment at risk. I understand deleting posts that are continual repeats within the same day or couple of days, but other than that, the information provided by those "bashers" are the alert signals that help me limit my risk. An attitude of ignoring them or disallowing their posts, puts my investment at much more risk and makes me much more inclined to sell out because I do not have a good feel about the negatives I am up against.
I am extremely concerned about the latest financing deal where they have put all the assets up as collateral to that last set of IBs. How much am I at risk of losing the whole lock, stock and barrel if management defaults on that loan?
I am hanging in for the possible buy-out, and ONLY for that, but I am extremely concerned about their cash position and debts. Not happy that they did not achieve CFP this quarter like they had promised. I thought that loan would provide the extra financial boost to assure that CFP, and they still did not achieve it, except for one measly month. If someone is going to buy them out, I would think being CFP would definitely increase the dollar amount we will be paid to buy our shares.
Jay...do you have an investment in CDSS? Are they a competitor with Netwolves? Just gave them a quick look-see. I would appreciate a reply...Thanks!
2005 the companies EPS was (23). Just based on the numbers for the first 3 quarters of 2006 Netwolves will come in much lower with respect to the annual EPS 2006 numbers. This certainly is a turn around play with a possible big spike ahead. Remember, the sales pipeline is full.
Patience.. The small cap market is horrible. WOLV is doing better than it has in years.
Already more posts than CDSS.
Please understand. CONSTRUCTIVE, RELEVANT comments, positive OR negative are welcome.There is a difference between constructive criticism, and mindless incessant bashing that is totally irrelevant. The Yahoo basher simply regurgitated the same endless littany of outdated garbage.
Wow! That's quite a stake you have taken in Netwolves. I also don't mind reading the concerns of others if they can validate them. I expect the same from positive posts. I hope the best for you and I wish I could say I had 100,000 shares. I do think management has tried to turn things around for the better though. GL, Cursed
Cursed,
I am one Long WOLV holder that would just love to interact on this new IHUB board for WOLV. I have been an IHUB member for years and was so excited to see that a board was opening up over here. However, I hesitate to get very involved with a message board that has as its stated purpose to disallow any negative posts about the company in which I have a large sum of my money parked. I have more than 100,000 shares, and have been in and out of WOLV over the last 3 years; in consistantaly for the last 7 months or so. The risk gets way too high when I cannot also see what concerns others have about the company.
Looks like maybe another quarter of improving financials will help convince the market. Now that WOLV is on the OTCBB, it will be looked at by a different type of investor, one that looks at charts and T/A and news as opposed to fundamentals, generally. Right now the chart looks bad but it looks like its trying to put in a bottom here at .20 or thereabouts. I will be watching. Is WOLV working on any deals that it could PR ?
How come there are so few posts??? Are you deleting them all?
I am a long time Netwolves shareholder. I bought in a few years ago when they were a little over a buck. Now my average is around .40. I continue to pray they will turn things around and the PPS will reflect that...but, I'm starting to have my doubts. I will hold...but it's been over 2 years now. Just a little frustrated. GLTA, Cursed
WOLV is a GEM. You won't find too many other $.25 stocks with $25 MM sales, positive cash flow, a 27 MM float, General Electric and Berkshire Hathwaway as clients and trading at a 90% discount to its peers !!
If you can try and get an idea of the specific revenue projection for Q4 and rest of year that would be great.
No worries about Yahoo basher I will delete all basher posts. InvestorsHub is great it allows the moderatorm to be in control not the bashers.
what i do like about WOLV
Revenues for this quarter were 5.3m & that was without any revs from the swift contract. so if we extrapalate that forward X 4q's = 21.2m. not bad when you consider the market cap to buy the company is 7.75m. heck, any company could come along 7 buy wolv fire everyone & keep the customers and only pay 30 cents on the dollar.
therefore, wolv takeout value would be 80 cents per share.
my 1 worry is that the insiders will take this private due to that 18% note variables and get the co. on the cheap
what a god idea to have a board here
hopefully we can keep Justice off of this board with his toxic nonsense.
I plan on listening 7 participating on tomorrows CC @ 3pm. I have several questions for peter & wally. however its tough to get all of them asked so my hope here is that some of you may write these down & ask in case I get timed out. TIA
1. are we cash flow positive now
2. can you explain your strategy to profitabillity more in depth.
3. when will you be recognizing revenues from the telco & energy
deals. or have we in this quarter?
4. can you explain furthe on the the PR where 18% interest is
for borrowing occurred.
5. process time to go from pink sheets to the BB
6. can you expand on any successes in the education market for
the upcoming school year
7. Is sherry manning suing us for breach of contract ( I can't
find or verify any links to this one yet.
well friends these are some of my thoughts & questions and will
appreciate all answers & rebuttals.
WOLV should hit $.35 - $.40 this week IMO. Conference should indicate positive cash flow for Q4 and continued contract momentum. Also OTC BB coming very soon.
CDSS.OB at $.59 same sector as WOLV, about same number of shares OS. CDSS has far worse balance sheet than WOLV, and about the same revenue. CDSS is truning around similar to WOLV. WOLV should trade at least as high as CDSS.
Worth taking a look at.
Thanks
Welcome everyone. Listen to the Conference Call Monday if you have a chance the last one was very informative. WOLV executives are very upbeat for a reason, WOLV has turned the corner after finishing its cost cutting program and diversifying and expanding its customer base.
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