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Biotech / Medical : GMXX - GENEMAX CORP
ISON 0.00Sep 26 4:00 PM EDT

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To: afrayem onigwecher who started this subject8/4/2004 2:53:23 PM
From: StockDung   of 978
 
HO HO HO L0LOL->"Gayle Essary, Investrend president, announced that John M. Dutton, professional securities analyst qualified in the PAR program, published his Quarterly Update PAR coverage of Starnet Communications (OTCBB: SNMM) on August 12, 1999. Mr. Dutton has reconfirmed his BUY recommendation. His 12 month price target is $30 - $35."

PAR Analyst Announces Investment Opinion On Starnet Communications
Business Wire, August 12, 1999

NEW YORK--(BUSINESS WIRE)--Aug. 12, 1999--

Public Analysis & Review (PAR) is the unique professional independent analyst program administered by the non-profit Investors Research Institute, Inc. PAR research is distributed by Investrend Research. Gayle Essary, Investrend president, announced that John M. Dutton, professional securities analyst qualified in the PAR program, published his Quarterly Update PAR coverage of Starnet Communications (OTCBB: SNMM) on August 12, 1999. Mr. Dutton has reconfirmed his BUY recommendation. His 12 month price target is $30 - $35. Mr. Dutton will continue to follow Starnet Communications and issue Quarterly Update Reports. Mr. Essary noted that Investrend Research will be releasing shortly the previously announced Quarterly Update of MedCare Technologies (NASDAQ:MCAR). Initial Research Reports were recently issued on Vasogen Inc. (OTCBB:VSOGF) and M&A West (OTCBB:MAWI).

A summary of the Starnet Communications report follows. The entire report including disclaimers can be downloaded from the Investrend Website at www.investrend.com/research/snmmupdate1.html.

Please read the disclaimers posted on the Investrend site before investing.

We reaffirm our strong BUY recommendation. The reasons for the continuation of this recommendation are as follows.

1. The stock price of SNMM is down over 50% since its recent high of $29. We believe this decline is the result of side bar events coupled with nervous investors. The stock is presently at attractive levels.

2. Management is on course in executing its business strategy to become the dominant factor in most major phases of internet gaming. A current market share of 35% - 40% of all internet gaming sites belong to Starnet and its licensees. Present estimates are that only 10% of potential internet gaming customers use the internet to gamble.

3. Like most highly successful internet companies, Starnet is a dominant factor in its industry in both marketing and technology. It endeavors to pick franchisees capable of aggressive marketing to build a customer base. It exchanges a low initial license fee for an average 25% of their net revenues as an on-going license fee. It becomes their partner. However, unlike most top Internet companies, Starnet has escalating earnings and EBITDA.

4. At current prices, the stock sells at a P/E of 28x current year EPS estimate of $.47, and 11.8x the $1.13 estimate for next year. In fiscal 2001 and 2002, SNMM should obtain the earnings benefits from the high margins flowing from a large licensee base. Given a reasonable market 12 months hence, we expect SNMM to trade at 30x - 40x the $1.13 fiscal 2000 forecast of EPS, supported by a valuation of 25x to 30x EBITDA.

We further note the following:

For the year ending April 30, 1999, sales increased $6.4 million to $9.8 million, of which gaming accounted for $6 million of the increase and on-line interactive (adult) the balance of $0.4 million. EBITDA (earnings before interest, taxes, depreciation and amortization) expanded $3.6 million to $3.4 million from a negative ($0.234) million in 1998. Sales of gaming licenses to new operators totaled 36 in 1999 and 1 in the initial year of 1998. Recognized revenues from initial license sales in 1999 were $1.6 million. Revenues from on-going license fees from the 15 operating licensees of 20 completed sites totaled $3.5 million. Starnet's own casino (World Gaming Services) and its transaction service fees (EFT credit card processing) contributed revenues of $1.1 million. Total gaming revenues were $6.2 million. There were no significant comparable revenues in 1998.

In May 1999, 11 new licenses were sold bringing the total sold to 47 as of June 1. As of 2000 Q1 end, we estimate there were 25 operating licensors. Management has stated that it believes approximately 3-4 new licenses can be sold monthly for fiscal 2000 and 2001. Our earnings model assumes lower franchisee additions. Revenues from on-going licensee fees are a majority of StarnetAEs gaming revenues. In the current 2000 fiscal year, we expect initial license fees of $4.7 million and reoccurring license fees of $33.1 million. Revenues from World Gaming and transaction service fees should exceed $2.0 million. Total gaming revenues should total $39.8 million.

Finally, SNMM shares should be accepted for listing on the NMS of NASDAQ within 60 days. This listing coupled with the absence of the adult segment whose sale should be announced shortly, should broaden the stock's appeal to the institutional market place. With capital presently being raised, we expect shareholder's equity to exceed $50 million at year end, up from $9.4 million.

Mr. Dutton is the par supervisory analyst. He is a member of both the Boston and Los Angeles Security Analyst Societies, and has been an analyst and director of research at several firms including Moseley, Hallgarten, Estabrook & Weedon and LH Friend, Weinress, Frankson & Presson. He was president of Corsair Asset Management, an asset management firm, for over 11 years. For seven years, he was Executive Vice President of the international hospital company American Medical International. Mr. Dutton's past work includes development and execution of strategic and financial planning for small cap companies. Mr. Dutton presently is charged with expanding the PAR program.

For Further Information, please contact:

Starnet Communications, Inc., 425 Carrall Street, MezzanineLevel, Vancouver, B.C. V6B 6E3, Canada, Mr. Robert Grace, Investor Relations Phone 604-608-6035, Fax 604-684-0391 Email: mailto:robg@starnetc.com, website www.starnet.ca Investrend Research, John M. Dutton, President 801 S. Figueroa, Suite 1100, Los Angeles, CA 90017 Phone (213) 630-4401 Fax (213) 623-4590 e-mail: jmdutton@mediaone.com web site: www.investrend.com.

COPYRIGHT 1999 Business Wire
COPYRIGHT 2000 Gale Group
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