Retta, NPSC experienced a volume Break 326K vs. 18k avg.
Taken from "the stock of the week pick" at insiderstreet.com
New Paradigm Software (OTC BB:NPSC)
March 2, 2000
Symbol:NPSC
Float: 500K
Current Stock Price: 1.125
Shares Out: 3.92 Mil.
We were initially planning to release this info on Friday, but it looks like someone
jumped the gun on us. The stock has started to move up with a little more activity
the last two days. We just want to say it was not us buying or anyone we know of.
So, we feel that we should release this Stock of the Week ahead of schedule. Our
previous Stock of the Week, IBIZ, is up about 100% from our release on Monday.
Quick Summary
New Paradigm (NPSC) is a company that provides technically advanced Internet
services and applications for major enterprises. This consists of building websites,
producing software, and other advanced applications. NPSC has managed to add
an impressive list of clients in a relatively short period of time. Some of their
clients include Novartis, New York University, Motorola, Josephthal and National
Multiple Sclerosis Society.
The company owns three award-winning advertising and public relations agencies.
They also plan on acquiring more before the year is over. These acquisitions not
only provide other outlets for their Internet services, they also are a good source
of potential new clients for website design, etc. The company also has established
partnerships with several other advertising agencies which have/could be an
additional source of revenues.
Probably most importantly, we are not dealing with a brand new company without
any revenues and only a business plan. New Paradigm has more than doubled
their 9-month revenues from last year. Their latest 9-month revenues were
$4,000,000, which is up more than 100% from last year. The company is already
operating on the basis of positive cash flow and CEO Mark Blundell expects the
company to shortly break into profitability. We like that he also seems to back up
these statements by recently adding to his position in NPSC by purchasing 45,000
shares of the stock. The stock is only trading around 1.00 and has been fairly
range-bound over the last year. With such a small float of 500K, it may not take
much buying for this stock to move higher.
Detailed Overview
The company's core business is as an integrated Internet and advertising
company, able to offer a full range of communications tools and strategies to
their clients. In developing its Internet business, New Paradigm has concentrated
on partnering with advertising agencies as they have the relationships with target
enterprises at the right (strategic) level. The Group now has a number of major
enterprises as clients, either directly or through advertising agencies. These
include Motorola, Travelodge, Novartis, New York University, Icelandair, the
Socttish Tourist Board, and many others.
New Paradigm also has another unique opportunity for revenues. As the company
solves real problems for their clients they create technology products, which they
intend to develop and spin-off or sell. An example of such a product is the
recently introduced computer postcards and well received BuyBanners. Internet
Services
The Company is engaged in the Internet business through its wholly owned
subsidiary New Paradigm Inter-Link, Inc. Through NPIL the Company provides
Internet services to corporations and other organizations. The Company develops
their business by working with advertising agencies that have the appropriate
strategic relationships with their clients. In addition, the company develops new
products and services connected with the Internet. They also assists companies
with creating an Internet presence and to exploit other business opportunities,
which may arise in servicing the Internet community.
Internet - Website services
NPIL provides organizations with the ability to utilize the company's expertise in
creating a Web site. This expertise includes: assembling an appropriate team of
independent design consultants and, if necessary, programmers; designing the
site from both technical and aesthetic perspectives; implementing the design;
and then providing Web server hosting services independently from a customer's
own internal network to ensure security. NPIL specializes in providing custom
facilities to enable a customer's presence on the Internet to be constantly
evolving and interesting without adding to their existing workload. For example,
the site for the Association of the Bar of the City of New York is remotely updated
by association staff. A small software program ("applet") created by NPIL staff in
Java - a common computer programming language for the Internet - allows
customers to utilize information in the format in which it was created under
existing word processor programs such as Microsoft Word to automatically update
their Web site from their own offices. No translations or transitions are required -
the customer's staff member simply uses the common "cut and paste" technique
utilized within many programs to move the required document into the NPIL
applet. Typical revenues for building web sites has increased from $20,000 -
$30,000 to approximately $60,000 - $100,000 with continuing revenues for
maintenance and changes. The Company has created more than 20 Web sites for
customers of this service to date.
Examples of web sites created by New Paradigm include:
Novartis - for its "Program" product: www.programpet.com
Association of the Bar of the City of New York: www.abcny.org
NewYork University for its School of Continuing Studies: www.scps.nyu.edu
Novartis - for its "Sentinel" product: www.petprotect.com
Josephthal & Co - corporate Website: www.josephthal.com
Novartis - site for its "Clomicalm" product: www.clomicalm.com
Website services - marketing and distribution
The company is marketing its services primarily through indirect sales to
advertising agencies. The sales through advertising agencies result from an
integrated media campaign where the Internet portion is subcontracted to NPIL.
In addition, the company believes that clients of any advertising agencies that it
may acquire in the future are likely prospects for the Company's Internet related
services.
Financials
The company reported 1.6 million in revenues for the last quarter with a net loss
of $13,000. For the nine-month period ended December 31, 1999 revenues were
$4 million, up from $1.9 million a year previously. Net loss for the nine-month
period was $107,000, compared to a loss of $365,000 from the previous year.
Mark Blundell, CEO, said, "We are pleased with the continued growth of the
business evidenced by these results. We are already operating on the basis of a
positive cash flow, and with cost saving measures currently being implemented we
believe that the group will shortly break through into profitability." On January 18,
2000 the company announced that Mark Blundell, CEO, filed with the SEC for the
purchase of 45,000 shares of common stock of NPSC.
Acquisitions
New Paradigm is based in New York City. The company owns three advertising
agencies: SKC Advertising, Sutton & Partners, and GMG Public Relations, Inc. In
April 1998, New Paradigm announced that it had established its first advertising
agency with the acquisition of certain assets, including all the client relationships,
from SKC Advertising, a Westchester-based agency. SKC's key clients included,
Kemwel Holiday Autos, Peter Deilman Cruise Lines, The Carlton Hotel in New York
and The Castle at Tarrytown. Since the acquisition SKC has secured important new
clients such as the Socttish Tourist Board and Stewart International Airport which
have significantly increased its business.
GMG Public Relations, Inc. is an award-winning agency. The firm's creative work
has been recognized by numerous industry associations including The Advertising
Club of Westchester, The Public Relations Society of America and the North
American Summit Creative Awards. The organization has also received the
"Gannett Newspapers-Best of Show" award at an area award's dinner. GMG Public
Relations, serves a variety of industries including health care, real estate, retail,
consumer marketing, financial services, computer technology and service firms.
The firm's web site address is www.gmgpr.com. New Paradigm believes that with
its strengths in applying technology on the Internet and in database
management, it forms a valuable core for building an advertising business. The
Company intends to acquire a number of advertising businesses with three
objectives: To reduce costs by sharing resources, to increase profitability by
selling Internet and other technology services to the agencies' clients, and to
enable the agency to win larger accounts as part of a larger enterprise with a more
complete range of services.
Mark Blundell, President and CEO of New Paradigm said, "We are looking to
acquire several more agencies in the tri-state area by the end of 2000. Our goal
is to roll up several agencies so that we achieve economies of scale while
establishing centers of excellence in various marketing disciplines." He added,
"We chose GMG Public Relations, Inc. because it represents the 'center of
excellence' we were looking for in the PR area. Not only will GMG bring us the
immediate ability to add PR to the list of services we can offer to group clients,
but our intention is to develop a specific Internet PR program to address the
growing requirement for contact with this new media."
MORE INFORMATION
Company Websites:
www.newparadigm.com
www.buybanner.com
www.computerpostcard.com
Summary
This stock has a lot of the characteristics investors are looking for. First of all, the
company is in a very dynamic and timely industry. Secondly, the company is
growing very quickly and adding some big-named clients. Then you take a look at
management and they appear to be doing a great job. Then, when you look at
the stock, it really hasn't done very much. The 52-week range is 0.50 to 2.50 and
the stock is currently trading around 1.125. And the final interesting point is that
the float is only 500K, which means that the stock could move quickly with new
buying. |
