January 12, 2005
SpeculatingStocks.com Stock Pick: Silverstar Holdings, Ltd. (SSTR)
Stock Price: $1.31 (long-term strong buy)
Silverstar Holdings, Ltd. focuses on acquiring and controlling positions in high growth subscription-based businesses that stand to benefit from the economies of scale generated by Internet and other technology related platforms. It currently owns Fantasy Sports, Inc., a leading provider of fee based NASCAR-related and other fantasy sports games, as well as a stake in Magnolia Broadband, a fab-less semiconductor company and innovator of radio frequency (RF) solutions for the cellular industry.
The company generated revenues of $610,000 for the most recent quarter with a profit of $125,000, earnings of $0.01 per share. They worked through a one-time bad debt loss of $165,000 last quarter. The current quarter should turn out strongly, Silverstar Holdings received $500,000 from a note payable to the company on December 20th.
SSTR has been in a major uptrend since mid-August after it hit a low of $0.57. Volume has also picked up drastically over the past month and even more so yesterday.
There is $6.4 million in cash on the balance sheet and $3.9 million in notes receivable.
Book value for SSTR is $1.19 with 9.6 million shares outstanding.
SpeculatingStocks.com Target Price: We believe SSTR will hit $2.50 within the next 3-6 months.