PAT:
Actually, EDOCs growth timeline can and should move upward rather fast. The only hinderance is capital. Tim is in effect buying revenue, but when it comes to earnings, well that is a different story. What I mean is that if you hypothetically take a regular transcription company that is doing 1 mill in revs, this company typically will earn about 100k. Now, when you plug in EDOCs voice technology into this transcription company things look very different. The difference lies in the costs of goods sold. If you have look at an income statement from a company you will see how they break things down, like gross sales, cost of goods sold and so forth. The difference between gross sales and cost of goods sold is your gross profit margin(it is actually alittle more complicated than this, especially for large companies, but for this point I kept it basic). With a typical transcription company, under cost of goods sold lies the real COST: LABOR. Simply put, it cost alot of money to have good transcriptionists. Well, the beauty of EDOCs is that by utilizing voice technology, the labor cost go down dramatically! That means profit margins are larger and earnings get bigger. So, when I say EDOCs is buying revs, they themselves create the better earnings model by using their technology. Not to belabor the point further, but labor costs are so high, that the company bought a trancription co in Manilla to save on costs for those doc that want traditional typed records. The company has already said they are looking for $20 mill in reves this year, which represents a huge increase from last year. How many internet company can say they are profitable so soon after going operational? In my opinion the only thing holding this stock back is its listing on the OTCBB. Many of wall streets biggest players cannot recommend an OTCBB stock for compliance reasons. That is why this company is trying to get to NASDAQ as soon as possible. They qualify except for share price and hopefully that will change soon. I believe that the more investors hear about this the more enthusiasm will occur with the stock. Why do stocks go higher? More buyers than sellers. That is why I asked for someone(maybe you?) to start a new thread on SI in their Internet sub-site as this site gets tons of traffic. |
