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Muscle Pharm Corp. Message Board

birdshooter_6 19 posts  |  Last Activity: Feb 5, 2016 10:47 AM Member since: Feb 29, 2000
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  • birdshooter_6 by birdshooter_6 Nov 19, 2015 2:26 PM Flag

    TO LPTN up 12% today, with heavy volumen

  • birdshooter_6 by birdshooter_6 Nov 25, 2015 1:00 PM Flag

    LPTN Take a look at the volume. Up big today. Selling now for $ 0.24

  • birdshooter_6 by birdshooter_6 Dec 10, 2015 9:24 AM Flag

    Fusion Telecom: Accretive Acquisition Should Drive Organic Growth And Gross Margins
    Dec. 9, 2015 3:05 PM ET | About: Fusion Telecommunications International, Inc. (FSNN) by: Dallas Salazar
    Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...)I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
    Summary
    FSNN is out with big news regarding an accretive acquisition.
    With this acquisition FSNN addresses many of the bear thesis bullet points I believe were creating buyer reluctance.
    Look for FSNN to move higher in the coming quarter on momentum sustained from this announcement.
    Fusion Telecom (NASDAQ:FSNN), a name I've followed for a while now but a name in which I've never written about and hold no position in, is out with meaningful news of an accretive acquisition. This is most readily apparent in recent share price appreciation. Shares have traded as much as 75% higher on the news.
    The acquisition news, it should also be noted, is being uniformly praised by those whom I've asked to review. I actually believe this acquisition is bigger than even the recent share price appreciation indicates and that this acquisition puts Fusion, finally, in the conversation for ownership. For the longest time, despite some of my professional resources being long the stock, I've been forced to hold placement for Fusion on the sidelines. I don't think that's the case any longer. I'll explain.
    First, for those unfamiliar with this microcap, Fusion is a "provider of unified communications & cloud services, mainly IP-based digital voice and data communications services to small and medium sized businesses and other telecommunications carriers (via SEC.gov)". Essentially, Fusion brings professional communication management services and capacity to SMB's that might otherwise not have them or be relying on lesser/point-solution provided capacity. Think of Fusion as a cousin of the traditional SMB software productivity suite.
    Fusion has been able to scale its business, via a combination of organic and acquired growth, to a healthy ~$100 million in TTM revenues and a healthy near-breakeven cash flow. Both I think it goes without saying are definitively positive - especially in the always iffy microcap space. In addition to this, Fusion has real bank lending access via a credit facility that has both a revolver and a senior loan capacity, Fusion has a non-toxic cap structure, Fusion has committed major shareholders (including the sitting CEO), and Fusion has significant NOL's (which I'm always position on). So, in short, we're talking about a real company. That said, I have never had a position in the name and had little real intentions of taking one. Until, that is, the company did something like it did as detailed in the acquisition press release.
    The big issues that I had with Fusion leading into the acquisition announcement, which I promise I'm about to breakout, were that Fusion's revenue growth was slowing on an organic basis and that Fusion was "transitioning" its core competency from a balanced, two-segment approach to a more focused, one-segment approach. Why was it doing the latter? Because one of its segments is being completely commoditized and is seeing significant upticks to competition. Fusion being well-ran has decided to be proactive instead, focusing on what it does well and what it can do profitability. In very impressive fashion, Fusion has been able to hold its gross margins relatively flat throughout the process. Still, on the whole Fusion hasn't seen much from organic growth TTM and that was something that didn't sit well with me. Fusion has addressed this, or at least started, with its recent acquisition.
    Fusion announced that it has acquired Fidelity Voice and Data, another cloud voice, cloud connectivity, security, data center and cloud storage service provider, for a total consideration of $30 million. Now, that might seem like a hefty price tag at first glance at Fusions market cap - which sits at a gross ~$20 million. But, again, the tag seems exponentially smaller when comparing the consideration to the TTM revenues - which near ~$100 million. What does Fusion get from Fidelity that it was willing to deploy so much capital for? The answer is "a lot".
    First, Fusion acquires Fidelity's tech. That matters. Fusion now has a deeper roster of technology, gets slightly more vertical, and has fully "integrated" talent that comes on board with a deep familiarity with the tech. That matters too.
    Second, Fusion acquires accretive drop down for its financials. This is being led by Fidelity's ~$18 million per year revenue generation which it should be noted is 90% monthly recurring. Fidelity's revenue base breaks out to roughly $750 per month per customer which has an impressive low-churn rate of just one half of one percent per month. For an IaaS business that's, at least in my opinion, trying to blend into a SaaS that low churn rate and high ARPCustomer is huge. Really, really huge. From a financial standpoint, Fusion also picks up an estimated $6 million in Adjusted EBITDA when projecting in "expected synergies".
    As a quick sidebar I'd like to project that after integration is completed that I think that number (ARPCustomer) - if backed out between Fusion and Fidelity - grows significantly based on Fusion's operating prowess being overlayed onto the Fidelity model. We'll have to see if that proves out as true but that's my guess. To be clear, I don't view the accretive drop down on the income statement as an "end all, be all" of this deal - as Fusion is generating "healthy" net losses via a large D&A drop down - but it helps that Fidelity isn't outlined in the acquisition PR as significantly burning cash or operating at a loose net loss. Again, I like that Fusion is cash flow breakeven but still generating a GAAP-net loss on the income statement. That should keep the company from being a cash tax paying entity for quite some time ahead.
    Third, and maybe most importantly, Fusion adds ~2000 SMB's to its customer base. My biggest concern far and away prior to this acquisition was the lack of organic growth. My guess is that the customer base expansion along with the tech product portfolio expansion/optimization will help out with that in a big way. I also think that a focus of selling back into the customer base, which was indicated as a goal within the announcement PR, might provide a mid-term bump to gross margin. Presumably, these sales will come at a lower CAC and at a higher ARPCustomer in that Fidelity brings some up-sell capacity. Stay tuned for updates on if this proves out. Still, the fact that organic growth is now at least presumably at hand is positive.
    All told, I think this acquisition attacked my fears for Fusion head on. Fusion gets a little bigger, it gets more efficient, it picks up some organic growth (existing via Fidelity) and organic growth potential, it acquires more product capacity and spectrum, and it was able to lower its blended cost of debt in the process (from 11.2% to 8% via tapping a newly established credit facility). I really like this move and I would agree with those out opining on how well this positions the company for 2016. I'm looking to get in touch with management and will report my findings back to readers here.
    Good luck everybody.

  • birdshooter_6 by birdshooter_6 Dec 10, 2015 10:37 AM Flag

    On June 11, 2012, we executed a Securities Purchase Agreement with respect to a private placement of an aggregate of 1,943,852 shares of our Class A common stock at $1.02 per share and warrants to purchase 1,457,892 shares of our Class A common stock at an initial exercise price of $1.32 per share, which was subsequently reduced to $1.26 (“June 2012 Warrants”). The June 2012 Warrants are exercisable for a period of five years beginning on December 11, 2012. We accounted for the June 2012 Warrants issued to investors in accordance with ASC 815-10. ASC 815-10 provides guidance for determining whether an equity-linked financial instrument (or embedded feature) is indexed to an entity’s own stock. This applies to any freestanding financial instrument or embedded feature that has all the characteristics of a derivative under ASC 815-10, including any freestanding financial instrument that is potentially settled in an entity’s own stock.

  • Reply to

    Good article

    by birdshooter_6 Dec 10, 2015 9:24 AM
    birdshooter_6 birdshooter_6 Dec 10, 2015 6:36 PM Flag

    IMHO, those shares were sold on 12/7/2015 as per yesterday's press release.

  • Reply to

    street sweeper article

    by l.robin46 Jan 26, 2016 12:27 PM
    birdshooter_6 birdshooter_6 Jan 26, 2016 12:49 PM Flag

    Can you post the article or where to find it. Thanks

  • Reply to

    street sweeper article

    by l.robin46 Jan 26, 2016 12:27 PM
    birdshooter_6 birdshooter_6 Jan 26, 2016 1:04 PM Flag

    IMHO the article was written to help the shorts.

  • birdshooter_6 by birdshooter_6 Jan 26, 2016 1:45 PM Flag

    A lot of support around $ 3, if it holds around here after this article, can go much higher.

  • birdshooter_6 by birdshooter_6 Jan 27, 2016 9:59 AM Flag

    * Important Disclosure: The owners of TheStreetSweeper hold a short position in LPTH and stand to profit on any future declines in the stock price.

  • birdshooter_6 by birdshooter_6 Jan 27, 2016 10:33 AM Flag

    The shorts are doing everything possible to take the price down before the company report the Q on 2/4.

  • birdshooter_6 by birdshooter_6 Jan 27, 2016 12:55 PM Flag

    LPTH CPA firm is BDO USA, LLP. An outstanding firm.

  • Reply to

    Is LPTH "tragically low on cash"??

    by arithmeticr Jan 27, 2016 1:03 PM
    birdshooter_6 birdshooter_6 Jan 27, 2016 1:06 PM Flag

    Accumulated losses of $ 295M = not having to pay taxes for a long time
    Good for the Company and the shareholders

  • birdshooter_6 by birdshooter_6 Jan 27, 2016 2:25 PM Flag

    February 4 and we will see who is right and who is wrong. My bet is on LPTH

  • birdshooter_6 by birdshooter_6 Jan 27, 2016 4:23 PM Flag

    Jan 8, 2016 GAYNOR JOSEPH J JROfficer
    1,689 Direct Purchase at $2.55 per share.
    Jan 8, 2016 CIPOLLA DOROTHY MOfficer
    512 Direct Purchase at $2.55 per share.
    Jan 8, 2016 SYMMONS ALANOfficer
    539 Direct Purchase at $2.55 per share.

  • birdshooter_6 by birdshooter_6 Jan 29, 2016 10:58 AM Flag

    February 4th a great afternoon to celebrate.

  • birdshooter_6 by birdshooter_6 Jan 29, 2016 4:10 PM Flag

    Trading at $ 2.99

  • birdshooter_6 by birdshooter_6 Feb 3, 2016 1:49 PM Flag

    IMHO, December Q will not show increase in sales neither on backlog.
    Sep Q they reported sales of $ 4.2 M, preliminary for the Dec Q of $ 4.2M
    Backlog at the time they reported the Sep Q was $ 6.5M, preliminary for the Dec Q of $ 6.4M

  • birdshooter_6 by birdshooter_6 Feb 5, 2016 10:08 AM Flag

    For the March Q revenues could be lower than the preceding Q due to the Chinese New Year.

  • Reply to

    IMHO

    by birdshooter_6 Feb 5, 2016 10:08 AM
    birdshooter_6 birdshooter_6 Feb 5, 2016 10:47 AM Flag

    Like someone said yesterday in the CC, what matters is sequentially increasing revenue and earnings.

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