When people panic and make scandalous statements you know you...

When people panic and make scandalous statements you know you are near the bottom. No question the last downgrade was disappointing - to say the least - as we thought those were behind. But looking forward, unless you believe the CEO/company is lying, this is pretty cheap now. Mkt cap is $35m.. $11m cash.. EV $24m.. new guidance implies eEBITDA of 3.5-4.5x... priced to failed already. Add another $5m in cash and by end of fy19 we have the company on 2-3x ebitda..

these are multiples you see on companies heavily geared or with the balance sheet about to implode. Here debt is not an issue - they have no debt!

Also remember that the CEO bought a big chunk of stock at 28cps - so he has a seriously vested interested to make this work.

Its his reputation at risk now and he would know that he does not have room for multiple downgrades - so current numbers should be comfortably achievable. All the fundies on the company wanted him to run the business and none of them are selling. Turnarounds take time but I think we are now at the end of the downgrade profit cycle.