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I had planned exploring whether it's
too late for energy stocks in the weekend edition, but I instead I ended
up with bigger fish to fry. NetWork Installation (OTC BB: NWKI)
was out with mega news after the close on Friday, and that takes precedent
over the energy edition. No new entries in the BLOG since the last posting
on HESG.
On Energy:
Suffice it to say I now believe the
latter half of the first decade will be looked back on as the era of energy
stocks, but there is no reason to jump in now while conditions favor spiking
prices. When oil dropped 10% in the spring, high flying energy stocks dropped
30%. Let's wait for a pullback, and I'll publish a list of long term dividend
paying ideas and perhaps a small cap or two.
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NetWork Installation
(OTC BB: NWKI): Long Awaited Breakthrough |
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On Monday NWKI should become
the poster child for buying while they're cheap, quiet, and no one wants
them. On Friday, after the market closed, NWKI announced they have
achieved the kind of milestone CEO Jeffrey Hultman was brought in
to deliver.
For those who need a refresher, Hultman
is the former CEO of PacTel. Under his stewardship, PacTel grew from $100
million to $1 billion in revs through a combination of organic growth and
acquisitions. PacTel became Airtouch, and eventually became Verizon Wireless.
After completing the transition of
PacTel to Airtouch, Hultman took the reins at Dial Page. After a $50 million
IPO in 1991, Dial Page was merged with Multi Media Communications, which
was subsequently bought out by Nextel Communications.
Hultman is now at the helm of NetWork
Installation, and looking to make the company a major player in the
wireless infrastructure build out. As the internet becomes more and more
entwined in all of our lives, wireless internet access is appearing everywhere.
Betting on Hultman is like betting
on the New England Patriots to win. They don't win every game or every
Superbowl, but as long as Brady is quarterback, they are going to win a
lot of games.
Hultman took NWKI over in
early March, so it has taken seven months to find a suitable acquisition.
Now, it's kick off time.
On Friday, just after the market
closed, NWKI announced it had acquired privately held Kelley Communications
Company, Inc of Las Vegas, NV. Kelley Communications has become the number
1 networking company for the casino industry. Kelley designed and built
the first electronic sports book for Caesar’s Palace. Kelley boasts MGM
Mirage, Mandalay Bay Resort Group, Harrah’s Entertainment Group, Palm Resorts-N9ine
Group, Station Casinos, Borgata Resort and Casino, Perini Building Group
and Venetian Resorts and Casino as clients along with more traditional
construction firms.
NWKI vended up 14 million
shares of common stock to purchase Kelley, bringing the total to about
30 million I&O. The two companies combined should be generating in
excess of $10 million in annual sales. Prior to the acquisition,
NWKI
was generating about $3 million annually on its own.
With its reach extended into some
new arenas of core competency, NWKI is now positioned for even further
growth.
NWKI is another microcap technology
issue that is completely blown out and looking to rebound. This stock has
a history of rebounding from oversold levels. On Friday, NWKI was
up $.17 (23%) on a mere 12,000 shares of volume.
If we have any sort of reasonable
4th quarter rally in the tech sector, NWKI should find its way back
to the $1.50 level. There should be 30% to 50% easy money
in this one as Friday's news takes the company to a whole new level of
both sales and proprietary technology.
I have been suggesting to subscribers
these stocks need to be bought while they are cheap and no one wants them.
In the case of a blown out stock, the easy money is made in the first surge.
In the case of NWKI, the easy money should be made between $.90
and $1.25.
If the stock opens Monday morning
at a reasonable level- at or below $1, it should be good for a trade.
Consider the possibilities of new contract announcements in the casino
and construction industries and the wider variety of technologies and services.
NWKI gave up half the company
to nearly triple the sales and expand horizontally. It's rebound time.
Here is the complete press release
for your review:
| Press Release Source:
Network Installation Corp.
Network Installation
Acquires Kelley Technologies; Increases 2005 Revenue Run Rate to $10 Million
Friday September 23,
4:19 pm ET
IRVINE, Calif., Sept.
23 /PRNewswire-FirstCall/ -- Network Installation Corp. (OTC Bulletin Board:
NWKI - News), an IT and communications solutions provider, today announced
that it has acquired 100% of the outstanding shares of Las Vegas-based
Kelley Communications Company, Inc. d/b/a Kelley Technologies (KCCI). KCCI
is a national communications systems designer and project engineering firm.
KCCI shareholders received 14,061,577 shares of Network Installation common
stock in the exchange. Based on Network Installation's un-audited reported
revenue of $1.9 million through June 30, 2005 and KCCI's un-audited revenue
of approximately $4.9 million through August of 2005, the combined company's
annual revenue run rate for 2005 is expected to be approximately $10 million.
Network Installation
CEO Jeffrey R. Hultman stated, "Since the new management team arrived in
March of this year, we have publicly stated our strategy of accelerating
our growth through acquisition and after carefully evaluating a number
of opportunities which we were presented with, we chose to partner with
Kelley Technologies. The rationale for our partnership is simple; the obvious
synergies between our businesses, Kelley's long history of success with
an A-list of clients, and most importantly, the stellar reputation of Michael
Kelley and his team." He added, "Our strategy is aggressive, but our goal
is to continue to grow rapidly through high quality strategic acquisitions
such as Kelley, and grow organically, resulting in significant scale within
three years. I believe we have now taken the first but most important step
towards that objective."
KCCI President Michael
Kelley commented, "I am truly excited about this partnership with Network
Installation and pursuing the many opportunities we currently have before
us. Jeff and his team have a track record of multiple major successes within
the communications universe. Network Installation's core competencies in
the delivery of data and voice communications systems are a perfect complement
to our technology design, engineering, and project management capabilities.
I look forward to achieving great success and to the continued growth of
our combined organization."
Pursuant to the Agreement,
Mr. Hultman was appointed Chairman of Network Installation and will remain
as CEO. Mr. Kelley will remain President of KCCI, a wholly-owned subsidiary,
and will join the Network Installation Board of Directors. Network Installation
CFO Michael V. Rosenthal, has also been appointed to the Board of Directors.
Additionally, Network Installation Chairman Michael Novielli and Directors
Douglas Leighton and Theodore Smith have resigned their positions as Directors
of the Company. The Company plans to fill the remaining two vacancies on
the Board before the end of the year.
Outgoing Network Installation
Chairman Michael Novielli stated, "On behalf of Mssrs. Leighton and Smith,
we are extremely proud to have delivered such a significant event and dynamic
management team to the Network Installation shareholders. Since our involvement
began in April 2003, we've seen the Company grow its annual revenues dramatically.
I believe we are departing the Company with our mission accomplished. It's
now time to leave Network Installation in the very capable hands of the
management team we've assembled, so that they may pursue their clearly
articulated vision."
Mr. Hultman added, "The
Dutchess organization is one of the most proficient, resourceful and capable
teams of professionals I have dealt with in my 35 year business career.
Their ability to create solutions to challenges in matters of finance,
business strategies, legal or accounting alike, are second to none. They
have been a tremendous asset to management and certainly critical to the
growth of Network Installation. We are grateful for their past contributions
and although they still remain a major shareholder we will miss their day
to day input."
About Kelley Technologies
Founded in 1988, Kelley
Communications Company, Inc. d/b/a Kelley Technologies designs and integrates
custom audio and video, communications and technologies serving the gaming,
hospitality and entertainment industries. Michael Kelley's IVC successfully
implemented the first electronic sports and racing book, which debuted
in Las Vegas at Caesar's Palace. Since then, Kelley Technologies has designed
and built more than 70 Race Books, Sports Books and Off Track betting facilities
across North America. Some of its clients include; MGM Mirage, Mandalay
Bay Resort Group, University of Nevada Las Vegas, Whiting Turner Construction,
Harrah's Entertainment Group, Palm Resorts-N9ne Group, Station Casinos,
Borgata Resort and Casino, Perini Building Group and Venetian Resorts and
Casino. For additional information about Kelley Technologies please visit
www.kccinc.com.
About Network Installation
Network Installation
Corp. provides communications and IT solutions to the Fortune 1000, Government
Agencies, Municipalities, K-12, Universities and Multiple Property Owners.
These solutions include the design, installation and deployment of data,
voice and video networks as well as wireless networks including Wi-Fi applications
and integrated telecommunications solutions including Voice over Internet
Protocol (VoIP) applications. To find out more about Network Installation
Corp. (OTC Bulletin Board: NWKI - News), visit our corporate website at
www.networkinstallationcorp.net. The Company's public financial information
and filings can be viewed at www.sec.gov.
Forward-Looking Statements
This release contains
forward-looking statements, including, without limitation, statements concerning
our business and possible or assumed future results of operations. Our
actual results could differ materially from those anticipated in the forward-looking
statements for many reasons including: our ability to continue as a going
concern, adverse economic changes affecting markets we serve; competition
in our markets and industry segments; our timing and the profitability
of entering new markets; greater than expected costs, customer acceptance
of wireless networks or difficulties related to our integration of the
businesses we may acquire; and other risks and uncertainties as may be
detailed from time to time in our public announcements and SEC filings.
Although we believe the expectations reflected in the forward-looking statements
are reasonable, they relate only to events as of the date on which the
statements are made, and our future results, levels of activity, performance
or achievements may not meet these expectations. We do not intend to update
any of the forward-looking statements after the date of this document to
conform these statements to actual results or to changes in our expectations,
except as required by law.
For further information,
please contact Jeffrey R. Hultman, Chairman and CEO, Network Installation
Corp., jhultman@networkinstallationcorp.net, ph (949) 753-7551.
Source: Network Installation
Corp. |
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