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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services -- Ignore unavailable to you. Want to Upgrade?

To: OpenSea who wrote (5367)	3/7/1998 12:56:00 PM
From: JIN CHUN	Respond to of 27968

Jim, you are absolutely right. The margins on leasing are almost paper thin. They can vary between 3 to 5 percent on average. In many posts, I had tried to emphasize the point that the acquisition alone would add a substantial amount to FAMH's revenue stream and therefore the eps. If they do indeed have 8000 employees leased now, I can't imagine how they could do less than around 80MM in sales for Myriad. From what we have been told, Myriad's audit showed 1.8MM on 45MM sales, which is a net of 4 percent, right in line with industry averages. If they are going at an 80MM annual clip, at 4 percent, that's 3.2MM in net which would be about .08 eps for Firamada. Also, Myriad's core business is in administration, which could lessen the burden on the rest of FAMH's offices, by centralizing tasks with each office doing what it does best. Myriad could handle all of the payroll and administrative tasks for the offices, and then the margins for FAMH's core pre-acquisition offices would be higher. Add in the revenue from the core businesses, also add in their expanding IT initiative, the growing financing division, and revenue from the MD show (at least they can't lose much-Ira stated the initial outlay was recouped and that they have precommitments in 105 markets), and what you get IMO is right in line with what Ira had projected in the CC. There are, of course, many if's. If, however, anyone has followed this stock early on, those if's have slowly been reduced through attrition: audit release, better press releases, significant contracts, etc. If the company can follow through with the SEC filings, and the subsequent 10Q for the first Q of '98, and if they show revenues and profits that are in line with what they are saying, then there is absolutely no way IMO that the stock will be trading at the current levels. Once the institutional investors can verify their own DD through the filings, then I think that for all practical purposes, the tradeable float( as opposed to the actual float ) will be very small. If these things happen, and we are all taking a risk (INTC anyone?), then I do not think anyone will be able to call this a "lousy penny stock" much longer. I can think of many companies on the bigger exchange that are either losing money, or do not match the revenue of FAMH. Can't keep a good thing down for long. Jin. When it comes right down to it, our manners separate us from the vagabonds.