40c that would be 3000% in less than 18 months ..that's insane...if I wasnt in this stock and didnt know what I knew... I say you're a HARDCORE ramper.
Its not impossible but Id say maybe you could be out by 2-3 months.. if it does happen at all... Im 95% certain we will reach 20c in 1-3 months given all the potential contracts... just on the anticipation of them alone.
To achieve your 40c price you would need...
A run up to 15c before 4C
4C to have $1,500,000+ profit and not reveal the JV but hint it will come in 2-3 weeks. That would keep it 15-18c.
Now the JV better have some good figures...we have no idea how big it is and how risky it is ...although we know its a large client meaning some of the risk might be taken out.
The JV would need to help them get FY05 profit of $2,000,0000+ to get us over 20c..and hopefully not ask MSO to put up money but instead put up intellectual property and have it funded by the JV partner should it need funding. It's possible if the JV figures are big enough and the potential of the JV is big enough then we could see 30c+...if it isnt then we will be stuck in the mid to low 20's, if that.
If the JV partner is Unitab and the monitoring system contract is included in the JV then Id say less rise...but if the monitoring contract is separate then we could see a totally separate $10-30 million deal as they will cover NSW, QLD, NT, SA not just NSW(currently approx $7-10 million)
If it isnt Unitab (Im still assuming that the JV is in the gaming sector)...Id say Unitab is a VERY likely potential contract as Tab Limited are using MSO software until the Tabcorp merger is finalised. This end of contract was not the result of MSO software not being good enough it was due to the merger nullifying the contract..so the assumption is that MSO software is the best fit...also if some other vendor were to come in they would have to get NSW government approval for their software which could take many months. Id say its a basic walk in for MSO.
So if the JV is big enough and the Unitab contract is $10 million plus then 30c is not out of the question...however these things take time and Martis saying in 2 months might be a bit premature...Tabcorp only today released announcement that it has received 90% acceptance...this will now trigger the chain of events that will most probably be VERY profitable for MSO.
In the past the monitoring system was built using money from the original contract...that contract has been paid out which is money for nothing to MSO...even though the contract is finished the software still exists and doest need ANY R&D money...this new contract is PURE profit..getting paid twice to do the same job...Im ASSUMING that if expenses were to stay equal the finalisation of this contract would be $1-2 million profit for MSO for the next 10 years...making it a 13-26c stock with NO JV at all.
We also have the expiry of Tabcorp's $5 million jackpot system July next year....that is the same case R&D finished sign new contract and $5 million drop to the bottom line over 3 years..making it if all expenses stay equal and the other contract included a 26-39c stock.
Of course MSO will most probably expand the development team to create newer versions of their suite of products ...but that will just make them worth even more next time they sell them.
If the JV partner isnt Unitab and we do get unitab...then crack open the champagne we have a triple jackpot coming up.
And not to mention parliament talking about internet gaming and MSO already having done trials with Vodafone for a mobile version... makes you think how far can this all go? And what about the sale of Tab Limited's jackpot system to US casino's, who knows, that could still be news to come?
None of the above is certain...but there is a possibility it is and a very high possibilty if not all some of it will come to pass.
The 4C should start the ball rolling ;)
MSO Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
