Wolverine Resources Corp (WOLV)

[jaybird249]

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.