Electronic Game Card Offers Compelling Value
Electronic Game Card, Inc. [[EGMI.OB]] announced that it would hold its first quarter conference call on May 14, 2009 at 10:00 a.m. (EST) to discuss the company’s financial results for the first quarter of 2009. The company also revealed that several insiders have been purchasing shares of the stock on the open market ahead of the earnings release.
Electronic Game Card develops and markets innovative games to the promotional industry, along with the casino and gaming industries. The company’s flagship Electronic GameCard, a unique credit card sized pocket game, provides interactive capabilities with “instant win” excitement, and can be applied for many different gaming and promotional activities.
During the past 12 months, Electronic Game Card has delivered four profitable quarters, increased shareholder equity by $12 million, achieved cash balances net of all debt and convertible preferred of $3.5 million, expanded its software library from 25 to 32 titles, was awarded patents, and brought on new talent to deliver future growth.
For the full year of 2008, Electronic Game Card reported an 81 percent increase in net income to approximately $6.27 million, or $0.10 per share, on revenues of approximately $10.65 million. Meanwhile, the company showed approximately $8.28 million on its balance sheet with total current liabilities of just over $1 million, which makes for large safety cushion.
Considering its substantial growth rate, Electronic Game Card appears to be substantially undervalued. When subtracting out the company’s cash, the stock is trading with an earnings multiple of just 6.6x, based on its 2008 numbers. Assuming a very modest 20 percent growth rate in 2009, the company’s PEG ratio stands close to 0.33, which suggests the stock is undervalued.
In the end, Electronic Game Card appears well-positioned for 2009 and remains a great value even after the stock’s strong run-up. Investors looking for a speculative growth play in the OTC markets may want to consider adding this stock to their portfolio for 2009.
CONTACT: Daniel Minton, Managing Director, 406-862-5400, daniel@accelerize.com