REVERSE CORP (REF) Share Price: 11.5c Shares: 93,441,497 Market...

REVERSE CORP (REF)

Share Price: 11.5c
Shares: 93,441,497
Market Cap: $10.75m
Cash: $5.57m (31 December)
Listed Investments: 3,143,000 OTH @ 78c = $2.45m (82c takeover offer underway)
Enterprise Value: $2.73m

Dividend Last Year: 1c (8.69% yield, fully franked)
Options: None
Debt: None

Reverse Corp is a dinosaur from the days of reverse calling which is still surviving and bringing in cash as kids on mobile phones are using it to ring home. REF also own 95% of ozcontacts.com.au, an online contact lens website which made its first profit in the last half year. In Decembers half yearly they had $1.39m EBITDA and $940k NPAT - not a bad six month result for a company with an EV of just $2.13m. The two businesses combined are likely to keep bringing in a trickle of cash and EBITDA has actually been increasing over the last few years as they cut costs.

The team involved are currently hunting an acquisition (so its essentially a cash generating shell) but are VERY picky with 50+ targets reviewed in the last 18 months and turned down. When they do eventually find one it will likely be very good and hopefully one in the contact lens space. Until then ill just be sitting back and raking in the 8.69% dividend yield and seeing cash climb which should eventually be reflected in the share price.

REF have a history of releasing profit guidance early with the full year guidance due sometime in the next month, if good, the share price has a lot of room to move at current valuations:
2012 FY: $600k - $800k EBITDA
- http://hotcopper.com.au/threads/ann-market-update.1901891/#.VmJ0inYrLIU
2013 FY: $750k - $850k EBITDA
- http://hotcopper.com.au/threads/ann-profit-guidance.1992643/#.V0kvo_l97IU
2014: $2.3 million - $2.5 million EBITDA
- http://hotcopper.com.au/threads/ann-profit-guidance.2306469/#.V0kvVfl97IU
2015 FY: $3 million - $3.2 million EBITDA
- http://hotcopper.com.au/threads/ann-profit-guidance.2541703/#.V0kvCPl97IU