Microcap Potential Homeruns--Credible, and Reporting Message Board

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Microcap & Penny Stocks : Microcap Potential Homeruns--Credible, and Reporting

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To: ihubdetectivey who wrote (1009)	1/4/2014 12:34:26 PM
From: diddlysquatz	of 1056

In answer to your other questions. 1. You'll notice that apart from ADT, AlarmForce's multiple is industry standard. I also think AlarmForce trades at a higher multiple because of stronger institutional ownership and the much higher retail investor recognition of the company. They have bombarded the media with advertising over the last few years. A major weakness with AlarmForce is their churn. I recall reading where they see close to 10% churn in monitoring clients where Avante has near 0. You'll also notice that Alarmforce is growing at about 7 - 9% which is slightly higher then industry average? Avante is growing significantly faster partly because of the additional services. 2. In my discussion with management and some minor industry checks I am very confident that they have a lot of room for growth in secure travel services. The caveat here is that this service revenue will likely be quite lumpy so it will be important to watch it over a longer period rather than sequentially. 3. I do see a 15%+ recurring monitoring growth as reasonable and it is no longer just about Toronto. They have established small footholds in other areas including the US. While I feel the greater Toronto area is likely to add 10 - 15% for some time to come the real potential is in new areas. This is where the technology advantage really comes in. Thee is no reason why they cannot monitor facilities anywhere. Outside their core area they are partnering with security companies that have the feet on the ground. Avante offers the technology and monitoring while the partner company handles the laborious handling of the client including emergency calls and servicing. They are already monitoring homes in the Hamptons, Florida and many other areas. This is where they have the ability to scale very quickly. And as far as acquisitions....any in this direct area would allow them to grow the monitoring service much quicker but an interesting angle is other services, including monitoring of people, equipment, autos or other technology like high end entrance systems, locks and so many other possible products and services that they could just layer on top and offer to existing clientele. I hope this helps.

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