NTWK $6.0 …..Analyst Target: $16…...Pre-earnings rally to start…... Only 6 PE is 30% of sector average......Strong 2013 guidance calls for over 40 % revenue growth and $1/share net income .…..Two Cloud divisions are growing exponentially …Insiders have purchased 5% of company since 2010 and never sold a share. 4 million share float…. In 2010 NTWK went from $8 to $24 in 4 weeks with 50% lower revenue than today
Short-term Target: $16 per Upgrade………
Record 1Q 2013 earnings 2 weeks away…….radar this one
In 2010 global software provider Netsol Technologies (NASDAQ: NTWK) went from $8 to $24 in a few weeks. Today NTWK is a much stronger company with far more revenue sources including 2 new high-growth high-margin Cloud Divisions. Unlike 2010, NTWK today has the flexibility to deliver products and services not only from Pakistan but also from excellence centers located in Bangkok, Beijing, the US, and the UK.
During 2010 (and 2007) NTWK's market cap reached over $100 million on 50% lower revenues of what is projected for 2013.
During the September 4Q 2012 CC NTWK officials stated that revenues are expected to reach $100 Million in 2015 up significantly from the $38 Million reported in 2012. They also expect margins to continue to go up as the high-margin Cloud divisions keep continuing exponentially to revenues.
MUST READ ……This Week’s Analysts Comments on Upgrade:
We project 13% annual growth to FY14 from FY10 reflecting 80 significant NFS legacy customers in FY14, up from 52, 37, and 28 in FY12, FY11, and FY10, respectively.
The new Vroozi Cloud Division contributed $1.3 million in FY12. We expect at least $4 million in FY13 and $6 million to FY14
Our price target is based on the average forward 2013 P/E multiple of 13.2X (up from 12.8X in August 2012). NTWK is trading at 6.4X our FY13 projections.
We are forecasting EPS of $0.85 per share. We applied an 11X multiple to our FY13 EPS forecast. We anticipate a richer multiple as earnings momentum builds in FY13. The company guidance calls for $1/share net income in 2013.
NTWK is entering FY13 with a $25 million backlog and approximately $100 million in qualified leads. One quarter of the backlog is from four new NFS platform customer implementations that began in 4Q12.
In August 2011, NetSol launched its Cloud Vroozi Division, an e-procurement search tool for SAP supplier relationship management (SRM) users. SAP AG is a global vendor of enterprise management systems that has the largest market share (24%) based on a worldwide Gartner survey. Vroozi should provide sales diversification and a higher margin recurring revenue stream. The Vroozi division contributed $1.3 million in FY12 sales and is expected to grow to $4 million in revenues in 2013
NTWK announced its 2nd Cloud Division last week offering an array of products and services to capture a greater % of the cloud applications in North America. The company is implementing this division using their significant software development capabilities and infrastructure.
=== MORE NTWWK HIGHLIGHTS:
- Company projects Doubling/Tripling revenues and net income by 2015
- Significant Institutional investor ownership and growing
- Insiders bought over 5% of the Outstanding shares the last 2 years and never sold a single share
- Total share count is only 7.5 million shares. The float is only 3 million shares
- Trading at forward PE of 5
- Strong balance sheet with $1.5/share cash
- Has global agreement with Mercedes Benz - Already 7 countries with NTWK software for leasing and financing Mercedes Benz/Daimler including China, India, Japan, and others…and a few more coming in quarters/years ahead.
- No.1 in China and APAC in leasing/financing software products and services.
NTWK has over 50 Fortune 100 loyal customers. Never lost a customer. None of the customers is over 5% of the total revenues - partial customer list: CitiGroup, Mercedes Benz, Santander, BMW, Volvo, Ford, GE Capital, Cisco Capital, Paribas, GMAC, Volvo, Toyota, Nissan, Hyundai, BYD, SANY Corp. China, etc.
NetSol Technologies, Inc. ((NASDAQ: NTWK) is a worldwide provider of global IT and enterprise application solutions that include credit and finance portfolio management systems, SAP consulting and services, custom development, systems integration, and technical services for the global Financial, Leasing, Insurance, Energy, and Technology markets. Headquartered in Calabasas, Calif., NetSol's product and services offerings have achieved ISO 9001, ISO 20000, ISO 27001, and SEI (Software Engineering Institute) CMMI (Capability Maturity Model) Maturity Level 5 assessments, a distinction shared by only 178 companies worldwide. The company's clients include Fortune 500 manufacturers, global automakers, financial institutions, utilities, technology providers, and government agencies. NetSol has delivery and support locations in San Francisco, London, Beijing, Bangkok, Lahore, Adelaide, Rio de Janeiro, and Riyadh