(NASDAQ: POWR)
Initiating date: 04-20-04
Price at the time of Initial Coverage $3.85
Initial 12-18 Month Price Target $5.60
Current Price Target: $20.00
Raised Rating From 4 to 6 on 05-03-04
Lowered Price target from $5.60 to $5.00 on 09-06-04
Raised Price target From $5.00 to $7.50 on 11-23-05
Raised Price target from $7.50 to $12.50 and Lowered Rating from 4 to 2 on 01-30-06
Raised Rating From 2 to 4 and Raised Price Target from $12.50 to $20.00 on 05-17-06
" Southern Flow Companies, Inc.- provides "…measurement, calibration and analytical services to natural gas producers, oil, gas and petrochemical companies and gas transportation companies".
" Metretek Inc, -provider of measurement and correction technologies and evolving "Machine to Machine" (M2M) solutions, primarily to the utility industry, that are focused on collecting data from remote devices regionally, nationally, and internationally and/or monitoring the local conditions of a specific field unit and communicating this information securely and reliably back to a central data base.
" PowerSecure, Inc. - a provider of Interactive "Distributed Generation" (DG) as backup and grid parallel energy management systems that allow clients to sustain electric reliability and take advantage of tariff driven peak shaving, load-interruption utility incentives, and real-time pricing.
The company was originally founded as Marcum Natural Gas Services, Inc., and was engaged in measurement and data collection services much like the current Southern Flow subsidiary. In an effort to grow the business and its geographic breadth, Marcum acquired Southern Flow in 1993. Southern Flow (the predecessor) has provided these services to the gas industry since 1953, and today the company indicates that the consolidated subsidiary is the largest independent measurement company in the United States.
The core competencies within the company's legacy measurement and recordation services have provided a platform for the creation and/or addition of related energy centric technologies/businesses. As a result, the company has been able to establish offerings in multiple energy sectors further expanding the reach of the business plan and reducing the exposure it once had as a single sector enabler. Moreover, I believe that this approach has positioned the company to take advantage of some rather profound changes in several areas of the energy business. As I will delineate further in this report, while the company's established businesses in mature base economy energy markets should provide it with predictable and dependable cash flow opportunities going forward, its position within the afore mentioned emerging areas of the energy paradigm could provide measurable growth opportunities going forward, which I believe could ultimately set the table for substantially better valuations going forward.
DISCLAIMER STATEMENT
The information contained in this report has been written by David Lavigne of EdgeWater Research Partners LLC ("Edgewater") and has been derived from sources considered reliable, but cannot be guaranteed by us. Edgewater and Lavigne are not aware of any material conflict of interest known at the time of the publication of this report. Financial projections and estimates herein represent our independent analysis based upon information in conjunction with the Company's publicly available financial statements. Edgewater and Lavigne may maintain positions in the securities referenced, which may change at any time without notice. Edgewater does not receive fees, warrants or any other compensation from issuers in connection with its research. It does however, encourage issuers and it representatives to subscribe to Edgewater's research, and from time to time, issuers and or their representatives may also purchase individual copies of Edgewater's research products. Edgewater and Lavigne may own options, rights or warrants to purchase any of the securities of the Company. This report is for informational purposes only and is not to be construed as specific investment advice or recommendations, nor as an offer to sell or a solicitation of an offer to buy any securities. The securities referenced are speculative in nature and may not be suitable for your specific investment objective. For specific investment advice or recommendations, please consult with your investment representative.
