Smartpay

[MACX]

Anyone following this? Looking like a turnaround story, new management looks solid, in a short time they have regained control of the cash flows, recapitalized the business, and refinanced the debt at very favourable rates. Management have good skin in the game to align interests with shareholders. Presentation out today looks good, ASX listing coming before year end, looks like industry consolidation could be on the cards in NZ, and in oz EMV upgrade will provide opportunity for Smartpay.

Any thoughts out there?

[Nigel]

Any thoughts out there?

My initial thought is around contactless payment, mobile wallet etc. As other providers bring out new technologies for making payments, does Smartpay lose out? or are they somehow involved in these new processes? I just don't see too many eftpos terminals being around in 5-10 years time. Would love to be enlightened by some 'in the know'.

[MACX]

Yes this is the elephant in the room for the industry. Spy do touch on this in yesterday's presation, they have the terminal technology to facilitate contact less payment, part of their strategy going forward will to seize on the opportunity that exists within this space.

[MACX]

Over 2 million shares changed hands today, very strong price action particularly when you consider the recent run up in share price. Interesting.

[Nigel]

Interesting indeed. Hey, you should probably be continuing this discussion on the existing thread for Smartpay, rather than starting this new one (I put you wrong by commenting on this new one earlier today). I've just had a quick look, and the existing conversation can be found here:

http://www.sharetrader.co.nz/showthread.php?3666-SPY-SmartPay/page5&highlight=spy

[Lizard]

My opinion hasn't changed much from that last expressed on the thread shown there.

Bradley Gerdis has achieved an important step by securing bank funding and paying off expensive securitised debt, plus increasing equity in the business. At $7.5m EBITDA forecast, they may achieve $1.5m NPAT for 2013. The price for this has been heavy dilution - and I think there might still be another 20m possible shares from convertible notes ($2m at 10cps) before Feb? Taking that into account, the forward PE for 2013 looks to be around 26 here at 14cps, so the price is presuming rapid earnings per share growth from there.

Given the influence of upgrade cycles on revenue, I find growth difficult to forecast. But the high-capital nature of the rental model may be a separate constraint on eps growth.

(Note there also look to be another 32m shares which could potentially be issued on options exercise, but average exercise price is above 22cps, so - at least on average - these are out of the money for now)

[percy]

Lizard
Thank you for your post.I have found trying to understand the capital changes and earnings out look for SPY difficult,so your post has been most helpfull.

[MACX]

Agreed this is not a cheap company based off their guidance given back in May I was a little disappointed that we did not see a trading update given at the AGM. However you get the feeling that change is about to occur within the industry here in NZ plenty of rumours around so I watch with interest. Bear in mind that any options conversation also brings $$$ in the door and given the strike prices hardly dilutive.

[MACX]

Solid off screen accumulating continuing at 15 cents in this one, something's up maybe?

[MACX]

Recent movements in the top shareholders show that it's the fund managers doing the accumulating here not the retail investor, this speaks volumes in my opinion, now 16.5 cents and climbing.

[Anna Naum]

Doubt fund managers are buying in. This company needs more cash so any fund manager who was interested would just go direct to the company for a discounted placement.

Sorry for being skeptical about the profit forecast, they have said this before and not delivered, be interested in your thoughts on why it will be different this time.

[MACX]

Hey Sparky please refrain from accusing me of spruiking this stock as you call it when you know absolutely nothing, nada, zip about me. The evidence you seek can be obtained from your broker if you ask him to provide you with an update of the top shareholders which will show that from the period 30 September to 12 October the net purchases of SPY shares was 1,812,204 shares from NewZealand Central Depository Limited. Within NZCDL there are I think 5 custodial accounts (applicable to SPY) that act for various institutions both here and offshore, so you will not see market disclosure announcements.
Anna you are misinformed, NZ and AU fund managers already own this (including high profile ones),they played a big part in the capital rise at 11.5 and trust me have been buying ever since.

[MACX]

Sparky at no time have I encouraged anyone to buy this stock and in fact have already stated that this is not a cheap story based off company guidance previously given. You asked for the evidence and I supplied it.

[Anna Naum]

MACX, if indeed you are sure of your insto statement then I am sure you can back up this public information by naming the institutions, I am really interested in this so look forward to you providing this information. Thanks

[janner]

Shhhhhhh.. Let him pump and dump... It is my only hope to win the comp.. :t_up: