Lebed.biz Alert May 10th 2008 Part I
The two biggest momentum plays in the market during the recent weeks have been Visa (V) and MasterCard (MA).
Personally, I believe both of these companies will have problems ahead and they are now great shorts.
However, there is one company in the industry that I believe could be about to take off right now!
The company is Payment Data Systems, Inc. (PYDS).
PYDS closed this week at $0.046. There are 81MM shares outstanding and insiders own 65% of the shares. PYDS's market cap right now is only $3.7 million!
PYDS is one of V's certified Compliant Service Providers. Click here for a complete list of V's certified Compliant Service Providers.
PYDS is one of only four Visa Compliant Service Providers authorized for "Private Label Cards" and "Bank-Issued Transactions".
Americans can no longer take out home equity loans and they are running out of cash to spend. Everybody is resorting to using their credit cards.
The problem is... Americans don't have the cash to pay their credit card debt back.
Therefore, in my opinion... we are about to see massive amounts of credit card defaults and the market for credit card debt will dry up quickly.
It will soon be very difficult to obtain a credit card. Those with credit cards will have much lower limits than they do today.
What this will lead to is a booming market for debit cards. With PYDS being one of only four companies certified by Visa for private label cards... I believe PYDS's business is about to EXPLODE!
PYDS has three different product groups...
1) Merchant Services (Credit Card and ACH Processing). PYDS processed over $100 million in transactions last year!
2) Stored Value and Gift Cards. PYDS has the ability to create private label cards and has an exclusive deal with Natalie Gulbis for both gift cards and prepaid debit cards.
3) Bill Payment. PYDS operates Billx.com which allows consumers to pay all of their bills online from one location.
I believe each of these businesses individually are worth much more than PYDS's current market cap! Combined, I believe PYDS is ridiculously undervalued at these levels with TREMENDOUS upside potential!
PYDS announced in March that their January processing dollar-volume increased 61% over a year ago and February continued this trend with credit card processing dollar-volume up 53%.
PYDS has NO DEBT and they just received $750,000 in cash for the sale of a patent... which will show up in 1Q results that are due out next week! We already know that PYDS's 1Q processing dollar-volume was up big! There is a good chance this was an ABSOLUTELY HUGE quarter!
In my opinion, with the recent runs in V and MA... PYDS is almost a sure thing to take off!
Of course, I could be wrong. Do your own research and make your own investment decisions. Never make investment decisions based on anything I say or you could lose all of your money.
-----
My firm Lebed Biz LLC has been compensated by PYDS $20,000 cash for a one-month investor relations contract. We were previously compensated by PYDS $25,000 cash for a one-month investor relations contract which has since expired. Never invest into a stock we discuss unless you can afford to lose your entire investment. For our full disclaimer go to: www.lebed.biz/disclaimer.htm
Jonathan Lebed
Lebed.biz
Staff
AI
