On a forward basis this company has a pe of less than 1.Lets...

On a forward basis this company has a pe of less than 1.

Lets take a closer look at the numbers:

FY06 Revenue: $5,597,000
FY06 NPAT: -$323,000

Now with the Jun06 quarter being cashFlow positive we can assume FY07 will be profitable.

Sales in america alone are growing at 20% every month, so compounded sales for FY07 would be $49,903,414.21.

Now lets say NPAT is 10% of revenue for arguments sake, then EPS for FY07 SHOULD be 8.5c. So at current prices the P/E ratio would be 5.8 giving that it would be easy to assume the company is undervalued by 50%. And with the new facility expected to grow revenue by 40% from Feb2007 (More likely march) this should be +$49Mill.

Orders from possible new european contracts should boost the companies revenue substantially over the next twelve months.

All this said, one would expect the share price to be between 65c and 75c by year end.

regards.