Just joined the register, page-9

You make a good point about the low marginal cost of production for digital products. I'm certainly no expert. It's probably the best point you have made in relation to this stock that isn't just optimistic hyperbole. Despite your point, I still believe that currently this business is completely and wholly overvalued by at least 100%. My calculations about earnings and sales were merely a very rough example to highlight the headwinds that the business faces. And that just gets it to a value which is fair against blue chip stocks that have long and proven track records of being successful.

The prospectus states that for FY14 67% of revenue will be derived in Australia. Given the entire Australian market is 3.6m students then it is clear that international sales will need to make up the bulk of this company's future earnings. It just so happens that overseas is where all the competition is, so achieving those sort of results may possibly be hard.

I can sense that you have a lot riding on this pending announcement. I hope that they deliver something that impresses the market and stock rallies to $3. Even if it does this, this doesn't highlight my flawed logic. Long term this company is selling a product that can easily and cheaply be replicated and delivered, as you mentioned above, with very low marginal cost. It doesn't appear that it requires any special talent, to solve complex problems or develop computer code that has any competitive advantage. They make educational software for kids. Which they have to go and sell against competition around the world. They better have great salesman.

Currently to buy ownership of this model, you have to pay approximately double what you would have to pay to get ownership of something that has an average P/E valuation for the ASX200. From my risk/reward profile and value perspective, I personally would never be able to buy this stock at this price when there are so many other 'sure things' on offer for so much cheaper.

Good luck on Tuesday.