Building on the solid growth momentum established through internal expansion and with the inking of some key mergers and acquisitions over the past few quarters, Premier Alliance Group (PIMO.OB) is a company positioned to make a significant move in the consulting, advisory and energy sustainability markets at a time when increased regulation from Washington and local municipalities is providing a boost for firms working in Premier's arena.
Most notably, the company acquired GreenHouse Holdings last month in a move that pushes Premier head-first into the energy and sustainability sector that is quickly growing into a multi-billion dollar market of its own. Businesses of all sizes, including most municipal, state and federal agencies, are consistently looking for means and methods to trim their energy costs while also meeting the stringent environmental standards being imposed by the environmental branches of the federal government in today's age.
In fact, the GreenHouse (GH) acquisition instantly positions Premier with an "in" when it comes to military base energy audits. Just weeks after publicly announcing that Premier and GreenHouse were set to merge, it was also announced that GH had secured a contract to conduct a complete energy audit of the Port Hueneme and Port Mugu Naval Bases in Ventura County, California. This deal is believed to be the first of its kind, in terms of size and scope, and given the recently-announced Department of Defense Energy Mandate for 2020, this is an area targeted by Premier for huge growth.
Already having an "in" with one such deal undoubtedly helps when looking to book similar contracts, especially in the world of DOD contracting.
In expanding the company's presence in Southern California, as well, a few new contracts were announced that could have significant growth implications moving forward.
The city of West Covina recently secured the services of Premier's GreenHouse division to assist in implementing Southern California Edison's (SCE) Automated Demand Response (Auto-DR) program. The Auto-DR program is designed to offer significant financial incentives to municipalities and companies that are willing to install equipment and take measures geared towards optimizing energy usage and thereby shedding total consumption.
The GreenHouse division quickly identified over $30,000 of incentives for West Covina shortly after implementation of its contract.
In relation to the West Covina contract, Premier's Vice President of Energy Services, Rob Davis, noted that,
Municipalities are ideal candidates for Auto-DR initiatives. The city of West Covina will realize significant cost savings, as well as, inroads to meeting their own power consumption and emissions reduction goals for 2012 and beyond.
With a foothold both in the military and municipality markets of Southern California, Premier is well-situated to take advantage of the growing demand for the services it provides, as demonstrated by other related deals announced last month, one for the Southern California facility of a global provider of energy management products and services, and another for Southern California Steel Industries, Inc.
The growing demand for its services in SoCals' Auto-DR initiates have quickly elevated Premier's reputation to "expert" in the field.
While concentration has been on the company's growing presence in the energy market, mainly because the energy-efficiency and sustainability business as a whole is booming right now, Premier has also demonstrated that its customer base is growing larger and more diversified in other of its key service arenas.
Premier has an existing presence and expertise in the fields of Governance, Risk & Compliance (NYSEMKT:GRC), Business Performance & Technology, and Finance & Accounting, with Knowledge Based Expertise targeted in the financial services and life sciences / biotechnology industries. As demonstrated by a slew of press releases over the early course of 2012, the company is growing its customer base in each of these fields while also receiving a boom in business in relation to its GreenHouse division.
In another move to increase the awareness and credibility of the company, it was announced last month that Harvey Pitt, former Chairman of the Chairman of the Securities Exchange Commission was appointed to Premier's Board of Directors. Mr. Pitt's appointment does not bring with it initial contracts, but it does add a well-recognized name to Premier's growing prestige and lends credibility to a small company looking to take its business plan to the next level, as Premier is positioned to do.
The company's stock is lightly-traded, meaning that volatility in terms of percentage gains and decreases is going to be a factor, but any sudden interest in the company's growth trend that brings trading volume with it has the potential to lead to a quick spike in price.
According to the last 10k, the company raked in roughly nineteen million dollars in the last fiscal year and has enough cash on hand to fund operations for another 12 months.
Premier's business plan and forward-looking strategy includes expanding its customer base through internal expansion and strategic acquisitions, and given the recent spurt of new contracts awarded, the company has thus far been successful in implementing this strategy and could be on the brink of taking the business plan to the next level.
In preparation, the company has prepared its operations to support those of a $100 million company.
With a current market cap of eleven million and a trading float of just over nine million, Premier will be one to watch over the current months. The pace of new contracts has been picking up and additional opportunities to employ the company's services should open up as the excessive regulation from Washington continues to roll out and companies look to contract advisory firms and consultants to decipher it all for them and then implement solutions.
Considering those facts, Premier Alliance is positioned at the right place, at just the right time.
Disclosure: No position, may initiate a long position within the next 72-hours.
Disclaimer: VFC's Stock House has been compensated by a third party, The ProActive Network, to provide research and coverage of Premier Alliance Group (PIMO.OB) for a period of thirty days beginning on 16 April. The goal of VFC's Stock House is to bring new ideas, companies and discussions to investors and readers. With respect to the increased amount of time necessary to maintain quality, VFC's Stock House is at times compensated from third parties to research and cover certain companies that fit the profile of what interests the readers of VFC's Stock House. While taking compensation poses as an inherent perception of bias in coverage, the ultimate goal is to bring ideas and information to the eyes of readers, who can then decide what is and what is not relevant. Happy Trading.