criterion (australian) and insider(the age), page-46

The company is now trading back at a fairer market cap @ around $20m in my opinion

Too much upside for future revenue was priced in the past months.

If they can double their subscriber base and create a strong brand and provide a good service then they are in business.

I cant see this trading on a high PE and with a No Contract business there is always that risk open to investors.

I am thinking 5-8 times NPAT

Just looking at their costs for the last 12 months

* Staff Costs - $6.5m

* Adverstising/Marketing - $6m

* Other working Capital - $10m

* Digital Services Costs - $1.5m

Total - $24m

Just as a hypothetical lets say all stays the same but Advertising/Marketing grows to $10m (which I think it has to to continue growth phase)

So lets say $30m in expenses

2011/12 revenue from customers was $18m

As a base case assume all customers were on streaming only at 14.99/month = $180/pa per subscriber

$30m (my estimate) / $180 = 166,000 subscribers to breakeven

At 200,000 subscribers with the same expenses =

34,000 subscribers above breakeven @ $180 = $6.1m

= 4m NPAT x PE 8 = 32m MCAP /450m shares on issue = 7 cents

IF QFX can achieve 59% growth again this year that would take them to 177,000 subscribers July 2012