Blue Star Mobile Share Discussion Threads

[rivaldo] 03/1/2006 12:39

Could be more buying tomorrow once readers have digested today's tip.

Harry, there is one broker forecast. Seymour Pierce forecast a small £40k loss before tax for the year. This implies a PBT for H2 of £75k, i.e an annualised profit of £150k.

With the World Cup coming up, plus the explosion of mobile content and BTR's partnerships with all the major operators, it wouldn't be unreasonable to assume an exponential increase in profits in the next year or two. Clearly on a £3.5m m/cap this would have an equal effect on the share price.

It's a punt. But as a punt on a company already in profit, with £400k of cash and with such a small m/cap I don't see much downside and it could turn out to be a multibagger.

[harryharris] 03/1/2006 10:02

I am surprised that the Guardian tip has only resulted in one purchase of £1200 worth of shares. I am not aware of any broker forecast, which is probably required to get the share price moving.

[rivaldo] 03/1/2006 09:22

Tipped for 2006 by the Guardian :o))

If BTR have revenue-sharing as well as content agreements linked to the World Cup the current £3.5m m/cap will be peanuts (though it's peanuts anyway imo considering their blue chip partner list, the turn into profitability in Q2 and the agreements already in place).

Here's the tip:


"Two events coincide in 2006 which should make it a prosperous year for Aim-listed Blue Star Mobile: further growth in mobile data services and this summer's world cup. Blue Star Mobile, which joined the market at the end of March 2005 at 20.75p and now sits at 12.25p, is a specialist in mobile phone content. Its tie-up with mobile operator T-Mobile is likely to pay big dividends. Blue Star handles sports promotions for the mobile firm including its shirt deals with West Bromwich Albion and Aston Villa. The stock is reasonably illiquid and just over 60% is held by founders and management who are barred from selling until March 2006. While insiders say no sales are expected when the lock-ins end, any shares that are sold are likely to be snapped up."

[rivaldo] 10/12/2005 19:14

Assuming BTR are on a revenue-sharing agreement here as they are with their other promotions, like the Sun page 3 service for mobile phones, this should be a massive winner for such a small company. I've seen loads of publicity for it, and since it commenced in September income should be really kicking in by now:



"Celebrity Messages
Blue Star Mobile Ltd, in conjunction with Celebrity Messages.com, launched the first ever official celebrity message catalogue of ringtones, videos and ringtones on the Sun in September 2005.
The content features exclusive content from a wide range of celebrities including Mr T Vernon Kay, Ant and Dec, Ian Wright, Dannii Minogue, Rio Ferdinand and Jensen Button.

Customers can choose from a video message, voicetone and caller tune with the additional option of sending to a friend."

[rivaldo] 08/12/2005 08:14

Even better...a seller of a decent amount of shares (by BTR's standards) got 13.1p yesterday, way above the bid.

Seems like there's a buyer in the background hoovering up shares.

[rivaldo] 03/12/2005 19:04

Nice to see a buyer paying the full 14.5p offer yesterday (first time I think that's happened).

I've been assured there'll be news flow, at least in the next month or two - certainly something will have to be said before 23rd December about the Bake acquisition. Any news could push this significantly higher imo - at the worst the spread will have to close considerably!

[rivaldo] 02/12/2005 08:12

Not many shares around? One 10k buy has pushed the offer price up nicely....

[rivaldo] 28/11/2005 08:35

Glad you agree tiraider. At these levels there would appear to be minimal downside, but multi-bagger upside. And I believe there'll be a good level of news flow to keep things bubbling over the next 2-3 months...not least the fact that the option to acquire Bake expires in December, so it's likely we should get news on this very soon indeed.

Good to see more small buying today.

[tiraider] 26/11/2005 13:06

Hi madman;

I don't post much these days, too busy running 2 businesses, so I haven't conversed with Zuke for ages.

Hope all's well with you. Like rivaldo's comment above, I thought BTR was worth a small punt some time ago as +es outweigh the -es on the fundamentals side. Unexciting chart though in a longer term downtrend but recent movement, if it continues, could break that trend. Big spread as well, so not a traders share.

Good luck and k/rgds
tr

[rivaldo] 24/11/2005 19:56

BTR's Sport division hasn't perhaps got the prominence it deserves, but this summary is worth noting - again, for a £3.5m company the list of clients is terrific. And note the last couple of paragraphs for future reference...



"Blue Star Sport is a sports marketing consultancy specialising in football and mobile services. Our areas of expertise include football promotions and sponsorships both in the UK and Asia and have close links with both The Premier League and The Football Association.

Blue Star Sport is the retained sports sponsorship agency for T-Mobile UK and currently negotiates, manages and activates all of its football contracts. This involves working primarily on football sponsorship, mobile projects but also includes other sports such as cycling.

This includes partnerships with Aston Villa, Birmingham City, Charlton Athletic, Southampton and West Bromwich Albion as well as England at EURO2004. We have also been retained to activate T-Mobile's sponsorship of World Cup 2006 in the UK.

Blue Star Sport is currently negotiating deals for clients across Asia wanting to sign up UK based sports stars."

[rivaldo] 24/11/2005 12:17

There wasn't an RNS about this, but it's on the BTR web site and is from September - it got a lot of publicity and should do BTR's reputation more good:


"Celebrity Messages
Blue Star Mobile Ltd, in conjunction with Celebrity Messages.com, launched the first ever official celebrity message catalogue of ringtones, videos and ringtones on the Sun in September 2005.

The content features exclusive content from a wide range of celebrities including Mr T Vernon Kay, Ant and Dec, Ian Wright, Dannii Minogue, Rio Ferdinand and Jensen Button.

Customers can choose from a video message, voicetone and caller tune with the additional option of sending to a friend.

Text Sun to 85080 to check out the service"

[rivaldo] 23/11/2005 20:46

Go for it mad4it - at the worst it's surely worth a small punt? At this m/cap, profitable, not needing any further funding, blue chip client list....hold with CGT relief and if it remotely takes off then this could be a very large winner.

The FD seemed keen to stress imo the possibility of contracts from foreign companies, so perhaps we could be in for some news on that front. The UK is the area leader in market content and BTR is already working for BA across Europe.

And just think how much kudos BTR get from managing the Sun's mobile portal, including Page 3, not to mention the exposure (groan....):

[mad4it] 23/11/2005 15:11

Hi tr, long time no speak, hope you're well.

No mate, but I'm pondering a purchase.

The informed discussion between rivaldo & WJ raised most of the bull and bear points....but I still can't make my mind up! lol!

Good luck.

ps: Are you still in contact with Zuke ? If so, please pass on my best wishes.

[rivaldo] 23/11/2005 12:55

Had a very good chat with the FD, who's currently in the middle of a round of institutional presentations.

Various points raised:
- possible overseas expansion
- income from revenue-sharing agreements will rise as new contracts kick in
- major shareholders locked in for one year
- "very disappointed" if no significant news flow in next few months
- no fundraising necessary for working capital purposes
- option to acquire Bake is due up on 22/12 and is being progressed towards a decision, so we should get news flow here

Quite rightly he didn't want to make profit forecasts, but my impression was that the statement about profitability in Q2 was an indicator that this was not a one-off, but part of a continuing trend of profitability in H2.

[tiraider] 23/11/2005 09:56

Hi madman,
do you hold these? I have for a while - showing a small loss though and disappointing share performance so far, looks like the results will liven them up a bit.

good luck
rgds
tr

[mad4it] 23/11/2005 08:42

Interesting discussion, thanks chaps.

[rivaldo] 23/11/2005 08:26

Nice start to the day - possibly some delayed buy trades to come, but I'm guessing there's not much stock around.

Still a m/cap of only £3.9m, yet now profitable and with annualised revenues of £2.4m without anything for all the recent contract wins and a blue chip client list. This is a realistic blue sky opportunity imo - no waiting around for years of development here, just real revenues and profits and an ambitious and youthful Board in an exponentially growing market.

[rivaldo] 22/11/2005 15:33

Glad to be of service :o))

At this early stage I very much doubt that much of BTR's £1.2m revenue in H1 was from messaging, especially given the multinational nature of their clients and the scale of contract work undertaken. There is profit-sharing - for example the recent British Airways contract - but I'd guess this is only just starting to kick in and should actually be seen as bonus revenue on top of the core business model.

I'll be trying to get hold of Seymour Pierce's broker note for more info.

[wjccghcc] 22/11/2005 15:12

They are reliant on message revenue (although hard to know how much) - a lot of their projects have a profit-sharing element.

I guess I just don't see what differentiates them from the tens of marketing companies in the same area (although they are specialist in this area whereas most of their competitors will probably be more generalist).

At least with WNN, I know there are really only three big connectivity providers (don't count SEA) so if I have a view on the total market, I'm pretty sure I know what I'm buying. I think I'll watch and wait with this one for a bit. Good luck with it.

Thanks for the useful discussion :-)

[rivaldo] 22/11/2005 14:29

Disagree since BTR aren't reliant on the message revenue as WNN are - their skills are in the following:

"A market leader in developing and delivering high quality mobile solutions, strategic promotions, consumer promotions and mobile sports marketing."

This is the growth area in the market. As I say, it won't take much to leverage BTR up from a £3.5m m/cap. But it will take a fair bit to see WNN to the next level, or re-rated from the current P/E if their revenues are seen to be falling away - particularly since EPS isn't forecast to increase much for them with tax kicking in.

Hey, I'm still pro-WNN! It's just that I can't see that much upside and I can see downside, whereas I can see terrific upside in a short timeframe for Blue Star.

[wjccghcc] 22/11/2005 14:10

Fair enough - nothing wrong with a good punt :-)

I think you'll find WNN actually earns a similar amount per message in gross margin terms from non-premium and premium business, it just affects turnover. For WNN, it's quantity of messages that count rather than quality. Of course they will experience a lull if premium rate business plateaus while the new regulations settle down but strangely enough, I'd have thought it would affect BTR more since much of their client content is actually premium rate.

[rivaldo] 22/11/2005 13:44

WNN are highly vulnerable if a large part of their income disappears through reduced premium rate income or action by clients - look at what happened with Stream. That's why I want to wait and see how they fare in their next results, as I can't see the shares going anywhere in the meantime without news.

Whereas BTR are starting from a lower base - at a £3.5m m/cap this is virtually seed capital. Given the multinational nature of the client base, the sector history of the main directors and BTR's obvious propensity for winning high profile campains (Page 3 for News Corp, british Airways, T-Mobile, O2 etc etc) the scope for growth from a standing start is enormous.

In particular, look at all the contracts announced in the last few months. I'd assume these will kick in particularly in H2.

Worth a punt at the least imo.

[wjccghcc] 22/11/2005 13:29

Perhaps although actually I would think WNN deserves a higher rating than BTR who are effectively a marketing agency bringing their expertise to manage other people's content - they don't have a subscriber base like MOB or technology integration into a client's IT systems like WNN and RGO. Means they're more like a media/ad agency who can be replaced if someone better comes along.

400k profit in H2 looks ambitious to me. The original business is growing at 25% half on half - they don't disclose how fast the sport business is growing so perhaps there's more growth here. Current gross margin is 35%. Assume that rises to 40% through operational gearing and you'd need turnover to rise from 1,165 to 2,310 to get your 400k profit. i.e. acceleration in organic turnover growth of 98%.

Am I missing something?

[rivaldo] 22/11/2005 13:01

Fair point (though I have a smaller stake in BTR), but WNN seems overly reliant on its premium rate revenue business and more vulnerable to regulation, consumer spending downturn. Plus it's rating, whilst not expensive, doesn't seem to me to have more than 25%-30% growth in it.

BTR however is more focussed on content and corporate work and is mega cheap based on its turnover and potential for growth - this could be a multibagger if it works out, and has lots of potential for news flow given its size. WNN may well do OK, but imo doesn't have anything like that potential.

and BTR is already profitable. If it does achieve £400,000 profit in H2 it will merit a share price at least double the current one.

[wjccghcc] 22/11/2005 12:48

Strange you sold out of Win and bought this instead rivaldo. Comparing the two, they actually overlap a lot in the services they provide to clients although Win obviously has the connectivity business as well. And Win is a lot cheaper. I can understand holding both but why switch?