from RB on MBAH....
By: investorgation
08 Jul 2004, 01:22 PM EDT
Msg. 1545 of 1549
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MBAH Update
MBA is working on multiple things that can positively impact the company in a major way.
They are in the middle of acquisition discussions with at least two more companies. These may be more significant than Screaming Eagles in that they would immediately impact the bottom line with a positive earnings flow. When I first mentioned that they were pursuing acquisitions, it seems the ones they are working on now are the ones they were most excited about when I first learned of their efforts to make new deals. These deals can add a net gain of up to $1M in earnings, not revenues, to the bottom line moving MBA into profitability. Remember the company is not debt ridden which is a big consideration. It is also why they are issuing and selling shares to finance these acquisitions. That is what shares are for after all. Since they are a legitimate company they could conceivably receive more traditional bank financing to facilitate acquisitions, but this way they incur no new debt and then can build up the share price with added value although there are more shares to work with. That is what you want with a penny stock if they are issuing shares. You have to ask: are they lining their pockets with those shares or are they using them to grow the company. The answer seems to be squarely in the latter. This would be a decent stock with the lower float, but it will be a better one with a higher OS and real growth. They have good management and their management team expansion with real industry veterans shows they are gearing up for that growth. Then the stock can become valued higher with new subsidiaries acquired plus additional partnerships and insurance affiliations bringing home the bacon in real increased earnings which we will see this year if they accomplish their objectives.
Regarding additional partnerships, they are also working on some big ones. One would be one of the world's largest insurance related companies. Another would be a automotive related membership organization with a large membership that is looking to offer insurance to members and MBA may be tapped to be their service agent. All of this brings more cash flow and earnings, so I'd say any of these announcements would be significant as well.
They seem to be working hard. That is how you grow a penny stock into a higher valuation with real fundamentals. If you add shares and bring value and earnings as a result your shares can be worth more on a market cap basis with more OS than less as opposed to just staying stagnant as a company. Since we already know MBA Direct is a very legitimate company we have reason to be optimistic that patience will pay off if the company continues to execute.
FANC may dump more shares, but if more announcements come they will be absorbed. A company like this and with their growth strategy can be worth alot more both on a market cap and per share basis with double the current shares, so stay tuned to see how the company fulfills their objectives. Then the stock could really grow. The dilution has kept the price down at present, but I will say their has been some additional pressure of naked shorting involved and the PPS has still held up much of the time in spite of that which is good. Additionally, there are some major investors who are taking advantage of this price to average down and accumulate so they are not complaining about FANC too much since it represents a buying opportunity to them since they are confident the trend will be up in the end anyway.
Cheers,
IvG
AI
