According To Anthony Tobin Veritas was just in the their corporate Headquarters because of the time zones to help ZSUN investors. Funny, I did not hear him say anything about them being in the same building to tout Titan Motorcycle Company of America. Does ZSUN have a large stock position in Titan? You can bet on it and when I get a hold of their portfolio the whole truth will come out. Cragun was mentioned in one of Titans filings. More on this later
To: Francois Goelo (2392 )
From: flodyie Saturday, Jun 5 1999 8:02PM ET
Reply # of 3218
Good to see Veritas on the web site and looksie here at the address that veritas uses in penneypicks p.r.
Veritas Group
462 Stevens Ave., Suite 106
Solana Beach, CA 92075
my my
Our featured PennyStock Pick for Thursday, September 24, 1998 is:
Titan Motorcycle Company of America
(OTC BB: TMOT)
Ask - Bid: $3 13/16 - 3 3/4
Major Newsbreak
Titan Motorcycle Company of America is Set to Produce Record Growth Figures Again This Year!
-- Projected Revenue for 1998 is $27 millon -- Stock Only Trades at $3 13/16 with a Very Low P/E! --
Titan Motorcycle Company of America has proven expertise in production, management, and marketing and an aggressive, forward-looking corporate philosophy. The Company's financial track record is outstanding and speaks for itself. Record revenue growth has been experienced ever since 1995 (i.e., $625K in F1995 to $4.9M in F1996 to greater than $13M in F1997). This revenue growth seems unstoppable, whereby halfway through 1998, the Company has already recorded revenues of $12.9M, and is therefore again on track to produce record growth figures this year. Earnings growth has followed revenues - with net income for the first 6 months of 1998 up 128% to $326,000 or $0.02 per share as compared to a net loss of $554,000 or ($0.035) per share on revenue of $5.7 million for the first half of 1997. For the second quarter ended July 4, 1998, the Company posted net income of $268,000 or $0.016 per share on record revenue of $7.5 million (up 100%) compared to a net loss of $253,000 or $0.016 per share on revenue of approximately $3.8 million for the comparable quarter of 1997. Projected revenue for 1998 is $27,416,631, yielding before-tax profits of $7,902,357. The stock trades at $3 13/16 and at a very low P/E ratio on expected earnings. Click here to read the press release that contains this information.
The Company expects to continue its top-line growth and analyst C.L. King & Associates projects Titan will produce 7,500 bikes a year by 2002 with revenues approaching $195 million including higher margin motorcycle apparel. Last August's Playboy magazine cover featured the Titan Gecko - the ultimate in custom designed, heavyweight, V-Twin engine motorcycles, from Titan Motorcycle Co. of America.
Analyst Reports and Recommendations: Highly accredited research firms have recently given Titan Motorcycle a BUY or STRONG BUY recommendation. There is no other strengthening endorsement of a company than an unbiased recommendation from a credible analyst of Wall Street or from the investment community. A few of these are: C.L. King & Associates, and Zacks Brokerage Research Center! Zacks Investment Research Group also ranks Titan 2nd of 61 companies within the Leisure and Recreational Products Group and gives the stock two thumbs up with a STRONG BUY recommendation.
Company Profile: Titan Motorcycle Co. of America is a premier designer, manufacturer and distributor of high-end, American-made, V-twin engine motorcycles marketed under various Titan trademarks. Titan's unique, hand-built configurations, including the GeckoTM, RoadrunnerTM, SidewinderTM, ScorpionTM, and CoyoteTM, represent the finest available in custom-designed, volume-produced, performance motorcycles, as displayed in their product catalog. Manufactured at the Company's 64,000 ft2 corporate headquarters and manufacturing facility, and available with a variety of customized options and design, Titan's large displacement motorcycles are sold through a dealership network of 58 stocking dealers in the United States and 19 international dealers. Titan expects its rapid growth trend to continue, since their products are experiencing an immediate acceptance in the marketplace for price, quality, design and reliability. On June 24, 1998, Titan applied to have its shares listed on the NASDAQ Small Capitalization market in anticipation of becoming a fully reporting company under Section 12 (g) of the Exchange Act, which is expected to occur by the end of 1998.
Corporate Overview: Few people have not heard of the legendary Harley-Davidson turnabout. From near bankruptcy to American icon in a few short years, the Company revamped its production techniques, improved its ailing quality issues and caught the world's imagination. In just 4 years the stock rose from its $4 level to surge through the $40 mark in 1998. However, success is always a catalyst for competition and with the worldwide demand for heavyweight V-twin motorcycles far exceeding supply, the opportunity to compete in this market was abundantly clear. The results to date have been astounding - with year-on-year growth records, quarter-in and quarter-out, the market has more than favorably responded to the product. Titan now dominates the high end of the V-twin market, which offers better profit margins for the Company and its distributors. This is a far less price sensitive market and Titan's highest priced motorcycle, the Gecko, accounts for over 50% of sales, although priced 30% higher than the top of the line Harley Davidson. In addition, Titan has developed significant cache value and has the ability to produce special editions, limited editions and designer edition machines with little extra production cost. Its production philosophy also means that it can bring new products on line quickly, giving it a flexible response to changing demands.
History of the Company: Titan Motorcycle Co. of America was born from the cult of the big, all-American V-twin motorcycles immortalized in movies like The Wild Ones, Easyrider and Electra Glide In Blue, machines that symbolized the free spirit of the modern American West. The Company began in 1994 by a father and son team, Frank Keery and Patrick (son), which proved to be a winning combination. Patrick Keery brings to the Company the well-established expertise in building customized high quality V-twin motorcycles. His father, Frank Keery, brings a wealth of extensive experience in manufacturing management, international sales, and marketing management of products for the automotive and electronics industries. Frank Keery used the cell production philosophy that was found to be successful in the electronics industry and adapted this to Titan products, which is currently being used by high-end European motor vehicle manufacturers. Together, their vision of providing the best machines of their kind, manufacturing them to the high quality standards demanded by the market, with worldwide distribution in fast-developing markets has led the Company to be highly successful and competitive. This is due to the fact that their dedication to quality and commitment to the product went hand-in-hand with good business practice. Unlike other start-up companies, Titan had the financial strength to overcome the critical development stage that most other start-up companies experience. This is primarily attributed to their skills and expertise in effectively marketing its product and establishing an international dealership network.
Reasons Why TMOT Deserves Investment Consideration:
Highly accredited research firms have recently given Titan Motorcycle a BUY or STRONG BUY recommendation
On August 6, 1998 Titan reported profitability on record sales for 2FQ1998 and first half F1998. Sales YTD rose 126% to $12.9 million, up from $5.7 for the same period a year ago. Net income YTD increased 128% to $326,000 or $0.02 per share versus a net loss of $554,000 or ($0.035) per share for the same period a year ago
On June 24, 1998, the Company reported that it applied to have its shares listed on the NASDAQ Small Cap market. The Company expects to enter NASDAQ Level 1 (full reporting) by the end of 1998
As of April 1998, the Company has secured a $5 million line of credit with Wells Fargo Bank and has no long-term debt
Other significant reasons:
Directors and Executive Officers beneficially own approx. 62% of the Company's outstanding common stock
Superior quality products have already won a high level of market acceptance, leading to consistently increasing sales and revenue
Addition of a 64,000 ft2 production facility to meet the continuing demand of increased growth capacity expectations from U.S. sales
Aggressive export of machines is generating excellent overseas sales figures
Key Management:
Frank Keery - Chairman and CEO, has 17 years management experience with the Rogers Corporation, which included new division startup, manufacturing management, and international sales and marketing management of products for the automotive and electronics industries. As a management consultant he advised medium sized and Fortune 500 companies on quality-based competition strategies for the 21st century. As an operating partner of Ardshiel Inc., an investment banking firm, he specialized in the turnaround of troubled companies.
Patrick Keery - President, is well-known and highly successful in the motorcycle customization and after-market retail industry, Patrick Keery created the Titan Motorcycle concept and is the design team-leader. He is the son of Frank Keery.
Robert Peltier - Operations Manager, is a veteran mechanical engineer with extensive experience in management and administration of advanced engineering enterprises. He supervises production, facilities, engineering, R&D, and quality control. His input was essential in the development of Titan's enhanced capacity to manufacture proprietary components.
Recent Press Releases:
08/06/98 - Titan Motorcycle Reports Profitability on Record Sales for 2Q and First Half of 1998
07/22/98 - Titan Motorcycle Co. Signs Agreement with PlayBoy Enterprises, Commemorating PlayBoy's 45th Anniversary
06/24/98 - Titan Motorcycle Co. Files Form 10SB, Applies To Nasdaq Smallcap
04/27/98 - Titan Motorcycle Co. Achieves Record Q1 Sales, First Profitability
04/20/98 - Titan Motorcycle Co. Secures $5 Million Line of Credit
04/06/98 - Titan Motorcycle Co. 1997 Revenue Up 262%... Stage Set for Profitability in 1998
03/17/97 - Titan Motorcycle Announces the 2 for 1 Forward Split of the Common Stock of the Company
Market Exposure and Strategy: Harley Davidson dominates the heavyweight bike sector, but admits that the current demand considerably exceeds supply. Titan benefits from the disparity of this strong, growing market and the lack of production capacity to meet demand. Industry estimates put the production shortfall at 30%, equivalent to some 40,000 machines. Harley Davidson plans to increase production by 9% a year, which will only enable it to keep pace with market growth without closing the shortfall gap. Titan has seized on this shortfall, and has already moved to profitability in 1998 on sales of less than 500 units.
Titan motorcycles have been approved by Easyrider Corporation, well known among heavyweight motorcycle enthusiasts, for sale in their stores throughout the U.S. as well as co-mingling dealerships with established Harley Davidson dealers. The Company expects these endorsements to lift Titan's image and increase exposure and market presence. Well known and successful in the motorcycle customization and after-market retail industry, Patrick Keery created the Titan Motorcycle concept and is supported by Robert Peltier, a specialist mechanical engineer with extensive experience in management and administration of advanced engineering enterprises.
Competition: Between 1995 and 1996 sales of on-highway bikes increased by 9% to 66% of the total market. This energetic growth has resulted in Titan firming up its production plans to reach more than 3,000 units a year by 2000, while Harley Davidson is targeting 200,000 a year by 2003. Mainstream producer, Honda, has already tripled production at its Maryville plant. The heavyweight market is dominated by Harley Davidson, with about 56%. Titan expects to increase its share from 0.5% in 1997 to 2% over the next three years.
Although Honda has launched two machines directly aimed at this market - the Valkyrie and the Shadow 1100, it has also had to recall two of its other heavyweight models which could dampen future demand for the Company's products. Yamaha's Royal Star is also pitched against Harley Davidson but production is being limited and its main value for the Company is to increase overall awareness of the Yamaha brand name. These mass-market producers are not competing directly for the Titan high end sector. A small number of "backyard" bike makers have put machines on the market in a limited way, with low distribution and no exports. Titan is the only "non-Harley" manufacturer in this sector to produce custom motorcycles with volume production and international distribution.
What about Quality of Product, Production, and in Order - Delivery Cycles:
Product: A standard Titan offers twice as much horsepower as the industry leader and weighs 15 to 20% less, resulting in a power to weight ratio double that of a production-line Harley Davidson. Titan's clean lines, hidden cables, extensive use of chrome, solid billet aluminum, paint schemes and finishes clearly sets them in a different class. But the quality of a product should best be described by industry experts. Click here to read their opinions.
Production: Each bike is assembled by a single production cell, the same cell production philosophy that Frank Keery found so successful in the electronics industry, which is also used by high-end European motor vehicle manufacturers. Highly skilled craftsmen work alone or in groups handling the building of the motorcycles from start to dispatch. If a customer has a problem, he or she can contact the man who personally built his machine. The cell technique allows production to be increased incrementally while retaining Titan's legendary quality. The Company has moved to a new 64,000 ft2 production facility which will accommodate projected increases in demand up to the new millennium.
In Order - Delivery Cycles: A V-twin enthusiast will typically buy an off-the shelf motorcycle for up to $20,000, then spend up to 50% of the purchase price on after-market parts and special paintwork. His aim is more power and highly individualized styling to match his vision of his dream machine. From the purchase decision to taking delivery may be as long as 18 months for the leading brand name bikes. Titan capitalizes on this problem that other dealers are faced with by manufacturing brand new motorcycles to customers' specifications in just 8 to 10 weeks.
Corporate Financials:
Financial Data Shares outstanding 16.3 million
Shares float 3 million
Market capitalization $63.05 million
52-week range $3 (low)- $6 3/4 (high)
recent price $3 3/4 (bid) - 3 13/16 (ask)
Number of employees 142
Growth: Beginning in 1997, the Company began to initiate a major program to vertically integrate select components and assemblies that are intended to reduce costs, improve the quality and availability of parts, and create a line of proprietary components and assemblies for sale to the general V-twin motorcycle market. Titan has also recently introduced a sports touring model that expands its target markets. The company has announced the signing of an exclusive agreement with Playboy Enterprises commemorating Playboy's 45th anniversary. The agreement calls for the production by Titan of 100 limited editions; numbered custom motorcycles bearing special Playboy anniversary hardware and color schemes.
In addition, Titan management has taken decisive steps to increase production and efficiency without compromising the quality that has become the company's greatest asset. Titan now manufactures frames, transmissions, clutches, and other key components in-house, reducing costs and generating lucrative sales of after-market parts. The Company has cashed in on the Titan mystique with a clothing and accessories line that will generate $1 million in bottom-line profits this year, and has outstanding growth prospects.
Exports: Titan aims to export 40% of total production, with special emphasis on Europe, where rising affluence, a quality road net, and the absence of a clear-cut market leader make conditions ideal for the entry of new products in Titan's class. Harley Davidson, however, has promised that it will not export more than 30% of its production. Titan has one very important plus point for buyers of this kind of machine - it is a genuine All-American cruiser - a vital element in its mystique. In many foreign markets, the American V-Twin carries a cache which more conventional machines lack. Titan's aggressive individuality, superior performance and customization gives it considerable added value in markets that still lag far behind the U.S. Most American buyers of Harley Davidsons spend large sums on custom parts and upgrade services that are simply unavailable in many countries. Titan's ability to deliver fully customized bikes direct from the factory gives the Company a distinct edge in these markets. Titan's world presence balances the more mature markets such as the U.S. and Europe with newer, more energetic markets (i.e., South Africa and Asia), and strengthens the company against economic variations in individual markets.
Distribution: Merely making the best motorcycle is only half the battle. Titan set out to establish a network of distributors in the U.S. and overseas. Not just resellers, but distributors whose technicians were trained at the Company's manufacturing base in Phoenix - a Rolls Royce philosophy that gives confidence to the distributor and credibility for the customer. In addition, buyers approaching the Company itself are referred to an authorized dealer or are charged the dealer price. Again, this gives dealers confidence in the quality of the relationship.
Titan has presently appointed a network of 28 domestic distributors. Each is required to have technicians trained and certified by Titan, reflecting the high service expectations of Titan buyers. This network is being expanded into the southern and mid-Atlantic States to reduce the effect of seasonal purchases and equalize year-round sales. One distributor of note is Easyrider Corporation, which is selling Titans in many of its company-owned stores, the only machine in its price category to be approved. This is another measure of the considerable confidence being shown in Titan by dealers. Internationally, Titan has begun to establish a similar quality distribution, maintaining its insistence on dealers having Titan-trained technicians, highest standard equipment, and key components in stock. The Company has employed full-time European and Asian sales managers, stationed at company headquarters, to manage the distributors in their respective regions.
Research & Development: Titan has developed a fully fledged R & D division which has developed a line of proprietary parts including high torque clutch assemblies, front ends, transmissions, machine billeted aluminum parts as well as the Titan Rubber Mount - a revolutionary engine-damping system that produces a smoother ride.
The Buyer: The typical Titan buyer is a particular breed - male, an upper income professional between 35-55 years old who owns, or has previously owned one or more Harley Davidson bikes and has traded in an existing bike to support the purchase of a Titan. The average age of motorcycle buyers is increasing generally, with the 35 to 54 year old age group, at its earnings peak, accounting for most sales.
Primary Contacts:
Company: Investor Relations:
Titan Motorcycle Co.
2222 West Peoria Avenue
Phoenix, AZ 85029
Veritas Group
462 Stevens Ave., Suite 106
Solana Beach, CA 92075
Tel: (602) 861-6977, Robert P. Lobban, CFO Tel: (888) 548-9777 or (604) 331-9583, Rory Voyes-Varley
Fax: (602) 861-9942 Fax: (604) 331-9584
E-mail: www.titanmc.com/email.html E-mail: knowledge@veritas-ir.com
Website: www.titanmc.com Website: www.veritas-ir.com/tmot_index.html
Investors or customers are welcome to contact Titan Motorcycle Company of America www.titanmc.com/email.html for new company developments or products!
A Fax-Blast is being distributed to numerous stock brokers in the U.S. beginning September 23, 1998 !
Conclusion: Titan Motorcycles of America has proven expertise in production, management, and marketing and an aggressive, forward-looking corporate philosophy. The Company's financial track record speaks for itself, whereby it has experienced rapid revenue growth ever since 1995 (i.e., $625K/F1995 to $4.9M/F1996 to greater than $13M/F1997). This revenue growth seems unstoppable, whereby halfway through 1998, the Company has already recorded revenues of $12.9M, and is therefore again on track to produce record growth figures this year. Projected revenue for 1998 is $27,416,631, yielding before-tax profits of $7,902,357. The stock trades at $3 13/16 and at a very low P/E ratio on expected earnings.
Analysts of highly accredited unbiased research firms have recently given Titan Motorcycle a BUY or STRONG BUY recommendation and PennyStock Picks very much agrees. We believe the Company is a very good candidate for both rapid growth and earnings on a short-term and long-term basis. Investors are encouraged to consider TMOT as an excellent investment opportunity.
Technical Position
Our interpretation of the technical position of Titan (TMOT) indicates that this company's stock price is significantly undervalued. The 52-week high for TMOT is $6 3/4 and 52-week low is $3. The stock currently trades at $3 13/16/share. The chart history of the Company shows that the stock price has recently been depressed, only due to the overall decline in the volatile market of today. This current depreciation in price, has nothing to do with company fundamentals and is substantiated by the record growth in revenue the Company is currently attaining. Today's price has been depressed back to the base level at about $3 1/2 to $4 that was previously established in January and March of this year and is therefore at the lower level of support. The price began to escalate back in April through June 1998, because the Company secured a $5 million line of credit and achieved record sales and profitability. The stock price should have held and maintained a constant upward trend from the $5 level that was set in June, July, and August, but didn't. This is an easy one to call based on our interpretation from the information provided to us. Knowing the pursuit and goal of company management to generate significant revenue and earnings, the price should begin to escalate in the near future. Moderate levels of resistance may be experienced at the lower $5 level (i.e., approx. 25% higher than todays prices) during this movement.
Titan Motorcycle Company of America - 1 year chart
Date of chart: September 23, 1998
PennyStock Picks believes the Company is significantly undervalued and the stock is currently at a very favorable buying price. Investing in this company involves minimum short-term risk if the overall market remains depressed or volatile. Our best judgement of the short-term (three months) target price is $6 (~ 60% higher than todays prices), and a conservative long-term (6 months to 1 year) target price of $8 (~ 110% higher).
Disclaimer
© 1998 PennyStock Picks. All materials presented on our web site and individual reports released to the public are not to be regarded as investment advice and are only for informative purposes. Before making a purchase or sale of any securities featured on our web site or mentioned in our reports, we strongly encourage and recommend consultation with a registered securities representative. This is not to be construed as a solicitation to buy or sell securities. As with any penny stock, companies we select as our stock picks involve a high degree of investment risk and volatility. All investors are cautioned that they may lose all or a portion of their investment if decide to make a purchase in any of our stock picks.
It should be understood that there is no guarantee past performance will be indicative of future results. The accuracy or completeness of the information on our web site or within our reports is only as reliable as the sources they were obtained from. PennyStock Picks may hold positions in securities mentioned herein, and may make purchases or sales in such securities featured on our web site or within our reports. In order to be in full compliance with the Securities Act of 1933, Section 17(b), PennyStock Picks received a modest fee of US $3,000 cash from the Company as compensation for its efforts in research, presenting, and disseminating this information. For more information, please read our company background and compliance information at: pennystockpicks.com, and compensation information at: pennystockpicks.com
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