Replies to post #27612 on Sigma Labs Inc (SASI)

[truthandlove]

Alan, these machines, depending on the size of the part, have the ability to make many dozens of parts in one machine run.

your quote

SGLB stated that they were receiving requests for quotes for contract printing on their new machine (which is apparently now operational) yet have never announced a service contract or associated revenue. I also have to wonder what the “payback” time is for a 3/4 million dollar printer to generate one-off parts a single part at a time

[Loco Motion]

I would be a little worried it I were you. MC announced in the last call that they had booked 150k in revenues for the month of November alone.

[Jackle]

I'm not too fussed about no contract awarded just yet. We know the machine only arrived in late November, We know they were being trained on it by EOS staff on the week of the webcast (Dec 1-5), and we know they were then installing the PrintRite3D® Inspect™ onto the machine. So all this was a well documented time frame and seems to have been going to schedule.

Whilst that was going on they announced they were in contact with lots of potential customers and had received very positive responses. Since, certainly in my mind there was no way a contract would have been signed by a company until the machine was installed and the lights were on, i consider it unsurprising that things hadn't been signed off yet.

Now, that being said and the machine likely to be up and running maybe late last week, or some time this week, would you bet against some kind of contract announcement in the next fortnight? Some kind of order? I certainly wouldn't bet against it.

As long as Sigma receives orders that utilize the machine the most efficiently then revenues will be coming in to assist the company during it's growth.

[monkeybuilt]

Hi Alan,

Finally we are at least back to a sane conversation. However, here's where I disagree:

I expected to see orders flow from the announcement of availability [of INSPECT]. This has not occurred

We don't know that INSPECT sales have not occurred. They announced that it was available but don't need to announce the first sale. They have also confirmed that they received revenue in November (at least $150K). Could be from INSPECT...could be from deposits for part orders. We'll know more when the 10K is out.

I also have to wonder what the “payback” time is for a 3/4 million dollar printer to generate one-off parts a single part at a time.

ROI is likely 1.5 to 2 years at 400-500K revenue per year. I came up with this using 2 different methods. One was to use a $1500 part x 300 parts per year. The other was to divide Morris Technologie's revenue by their machines.

SGLB announced almost a year ago now that they expected to see $750,000 in revenue this fiscal year. No announcement to date (this is a significant event) and two weeks left in the year.

This is not a required announcement as they stated they expected it. It could be trickling in during the quarter. They don't need to announce every check they cash. Example: We know they had recieved $150K in November at the time of the conference call but there was no PR for it.

Perhaps most worrisome to me is the fact that SGLB has only a single independent director who is looking out for shareholder interests. There is absolutely no excuse why this has been neglected for so long and raises a red flag in my mind.

One might argue that this is adequate for this size and stage of a company considering the fact that they have been doing live Q&As quarterly and they reply to correspondence quickly. Can't put the cart before the horse. Keep in mind that they've been doing exactly what they say they would do. Our anxiety won't speed up the clock.

Finally, with 612 million shares outstanding assuming a 20% net profit margin, SGLB would have to generate 30 million dollars in sales for a single penny to fall to the bottom line for each shareholder

Seriously??? You expect a penny per share on an 8 penny stock? Show me one example of this even close to this sector (or anywhere else for that matter). For an apples to apples comparison, you need to consider the valuations of others in this sector. P/E is a much better tool in this case. A 50 P/E would put you in the ballpark IMO. That's what I use for "guestimating" this gem. Your $30M in sales at 20% margin example at a (realistic) P/E of 50 translates closer to .40 PPS. I believe this is completely possible in the next few years on INSPECT alone. Throw in DEFORM, parts manufacturing, dental and some of SGLBs other tricks and $1 per share is a VERY reasonable expectation. It could go well beyond that. Keep in mind that seeing 100 to 150 P/E in this sector is quite common.

Long and cautiously optimistic...