Great response, you have somewhat shifted my sentiment on this...

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Waldo777

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14/06/17

11:10

Post #: 25262901
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Originally posted by UnclePanda ↑

You raise a good point. I also do believe that ATMs have a structural decline risk. The world is moving towards electronic currency. That said, what you fail to consider is that your view is myopic. Very close minded. You fail to consider where the ATMs are located. The company's most profitable ATM is located in the outback of Australia, where cash is used quite a lot. The company positions its ATMs in area that offer exceptional returns. If they don't make much money, they will be located elsewhere.

You also fail to consider that STL is more than just an ATM company. It's a integrated financials firm, with exposure to switching and EFTPOS. Switching revenue should only just start to hit the bottom line. The company just acquired INDUE. EFTPOS revenue hasn't hit the bottom line yet. Furthermore, all the ATMs are generating exceptional returns.

There's very little risk of a capital raising at this stage, unless the company wants to acquire a new venture. Management didn't want to do a capital raising to fund INDUE. But it happened because some of the finance options fell through. It was originally going to be funded purely by debt. My view is that STL is worth at least 7 cents per share based on the FY18 numbers.

It's difficult to go wrong from this entry point, IMO. STL is a great short term/ medium term hold. At least a 2-5 bagger on the cards by this time next year, I'd say.

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Great response, you have somewhat shifted my sentiment on this stock! That and there's still strong buying on market. Maybe I should keep STL on my trading watchlist after all. I've just been burnt with these investor presos in the past but as you and Oxxa have said it does look like a CR isn't so likely here given the circumstances.

STL Price at posting: 2.7¢ Sentiment: Sell Disclosure: Not Held
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Add STL (ASX) to my watchlist

Great response, you have somewhat shifted my sentiment on this...

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