Value Microcaps Motherboard

[whyme2005]

WSCI $4.2 ....RECORD EARNINGS TO BE ANNOUNCED ON OCTOBER 31.

WSCI will report earnings on October 31, 2005. This is the first time that the company actually announced an specific earnings date. The company will report record earnings and that might be the reason why the company decided to start making earnings-date announcements from now on.


Here are my estimates for 4Q and FY 2005 earnings results:

** 4Q and FY 2005 Earnings Estimates:

-- 2005 Revenues of close $16 M or almost 40% higher than the $11.4 M posted in 2004!!

-- 2005 net income of about 15c/share compared to 1c/share in 2004!!

-- 4Q 2005 revenues about 30% higher than 4Q 2004

-- 4Q 2005 estimated net income of about 6c/share compared to a loss of 4c/share in 4Q 2004.


Take a look at WSCI strong financial performance. Note that net income jumped significantly in 3Q 2005 ( to 7c/share). This is because the company completed its relocation to a new, larger, and more efficient facility at the end of 2Q 2005.

http://finance.yahoo.com/q/is?s=wsci

OK, so 2005 will be a record year for WSCI.

2006 will be even a better year. I expect net income to be about 25 - 35c/year in 2006 for a few reasons:

1)The company completed its relocation to its new manufacturing facility in 2Q 2004. That move cost the company 12 c/share in 2004.

2) A new contract with a biotec company will kick in in 1Q 2006 (10% increase in revenues...or about $400,000/quarter).

3) New ISO certification will open doors to new projects with existing and prospective customers.


Take a look at what happened prior to the 3Q blastoff.....same pattern ( see chart below).

http://stockcharts.com/gallery/?wsci

Some observations:

1) WSCI share prices has experienced an steady uptrend for over a year with several big spikes after every earnings report (lower chart).

2) Each successive earnings spike is bigger than the previous one ( See 3Q's in June 2005).


My experience with growing and profitable low floaters like WSCI is that they need two or more consecutive big quarters to break away from under $5. I believe that WSCI is right at a point where it will leave the under $5 trading range for good.


Do your DD