Small-Cap Updates (IGII, HQSM, PTSC, NMKT)

by: Microcap Speculator

The Microcap Speculator submits:

  • IBSG International (ticker: IGII) today announced an expansion of its Johannesburg contract to cover all of South Africa. According to the press release, IBSG expects the contract to yield $50M in revenues over four years, with initial revenue of $7.1 million. Part of the contract is likely to be funded by heavyweight BAE Systems. BAE is a shareholder in Global Eagle, IBSG's South African partner. Although this announcement is positive, I still have some questions about this stock. IBSG will need to back up the revenue announcements with genuine cash flow before I buy more.
  • HQ Sustainable Maritime (ticker: HQSM) CEO Norbert Sporns was interviewed by The highlights: (1) he expects the rate of growth to increase in 2006; (2) responding to a reader question, he said 6 cents per share "was certainly possible" in 2006; (3) dilution -- some contingent shares were issued with respect to the ALPS arrangement and some suppliers were issued shares; (4) the three founders collectively hold more than 50% and have no current plans to buy or sell shares; (5) the company is considering attempting a move to a national exchange. HQSM was close to meeting Amex listing requirements before those were changed late last year. Sporns sounded more encouraged about the possibility of listing on the Nasdaq Capital Markets (formerly Nasdaq Smallcap).
  • Patriot Scientific (ticker: PTSC) last week announced another important licensing deal, this time with Casio. The terms were not disclosed but I am guessing the company nets $5M - $7M on the deal. Improving fundamentals and strong newsflow have translated into a skyrocketing share price for PTSC. At one point shares crossed $1, and have since retraced to around $.72.
  • NewMarket Technology (ticker: NMKT) last week announced the acquisition of a profitable technology services firm in Brazil. Significantly, the acquisition is all cash and will not be dilutive. This stock has taken much longer than I expected to develop, but I continue to think it is turning the corner. CEO Phil Verges spoke to Wallstreet.Net about the acquisition. I have not had a chance to listen to the interview.
  • DISCLOSURE: I am long IGII.OB, HQSM.OB and NMKT.OB. I have no position in PTSC.OB. Not a recommendation to buy or sell any security. For informational and educational purposes only.