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Biotech / Medical : Labwire Inc. -- Ignore unavailable to you. Want to Upgrade?

To: rogerover who wrote (1411)	1/5/2009 11:38:17 PM
From: creede	Read Replies (1) \| Respond to of 1698

"I don't think anyone with half a brain still thinks the company is a scam, since they filed all that paperwork with the SEC and no one is going to sign off on a lie and risk fines and jail time. " priceless. I have to say I like you after what you have said in the above quote, but I also think that your valuations are a bit harsh. Are you seriously saying that if Labwire can uplist and grow to one cent earns per share you will only give them a PE of 10? Just don't see how that would be right in today's world of all these businesses collapsing. Look, I think what has happened in the market is a good thing. Everyone was pouring all that money into their 401k's, and thus all the fund managers were basically forced to by a lot of companies on their names alone. Bad companies that were loosing tons of money (Ford comes to mind) were still being propped up by all that long money pouring into the system month after month. Now, the current economic crisis has made many pull back their funds, and many have halted their buying through their 401k's. I say GREAT. That means there is cash on hand for the companies that deserve it - those that can show a profit. Therefore, I say there is no way in the world that any company showing a profit and growth is only going to get a PE of 10 that is not pink - especially with the clientlist that Labwire has. Boeing, Lockheed, Shell, and Greyhound are household names and should make it easy for a broker to sell the company if they can prove they will communicate with shareholders and the SEC well. Don't forget that their core business is compliance, and that is very recession proof because it's not an option - the companies have to do it because it's the law. Tell you what, can you please give me a list of OTCBB tickers that have earnings and a PE of 10, just to convince me? Now, regarding the margins, it's a tough thing to figure out, because they are all over the place in a good way. I guess you have figured out that they are not a brick and mortar company, and really don't do anything more than manage data. They don't test. They don't build anything. They don't even handle k9's. They get paid for other people doing the work. Here's the revenue streams. Drug Testing - I think they get about $39 per test, and make about $10. Background Screening - I'm not sure here, but I do know that per the filings they have cut out the middle man, and are now able to perform the background checks themselves. Obviously that makes the margins much better. Here's what they said in the first Form 10. "Labwire has recently acquired access to national data bases and has started to perform its own background checks. This service generates reports about a prospective employee’s criminal record, motor vehicle violations, credit standing and involvement in civil litigation. Labwire’s margins on this service can be increased by approximately 20%, if done in house." K9 services - Labwire gets 5% off the top of any revenue they send to American K9 and Bomb. That's the same as %5 margins, which may not sound that great, but then again it's almost free money, since they do not have to do anything but bill and collect. (and not to mention that Shell put the pressure on them to even get into this venture) Training - Labwire provides real-time, online federally mandated supervisor training and employee education that conforms to all DOT modality requirements in addition to DOD an DOE. This is all just done off the platform, and I believe I have heard the margins on this to be about 80%. Much of this is through OTI. Data Management and Transmission - Basically Labwire keeps track of a companies compliance data, so that they can prove to the government that they did what they said they were going to do. This is just data storage and could be in that 80% range as well, imo. Here's link to the services - Message 24684032 All that aside, would you not tend to agree that Labwire's margins must be pretty darn good if they had earnings last year on about $4.5MM, and had really no revenue from the sale of stock? The money that came in was from the business, and it turned a profit. Margins gotta be ok to do that. Oh, and one last point, Labwire goes after big clients in order to keep overhead low since you don't need much staff to handle big clients. I believe that research shows that about $4.5MM is breakeven for the company, because that's where fixed costs are met. If that is the case, then I think that if you double the revenue then an exponentially larger amount of money will hit the bottom line. GB-ND c