Bond International - Strong growth at a reasonable valuation

Mister Glasshalfull - looks possibly undervalued. Just posting the weakest links to see how posters react. Still researching. Depends whether you beleive this is in secular growth or cyclical phase. Just making the case that it doesn't appear ridiculously cheap to see what response I get. If this is a cyclical share then it is higher risk and deserves a lower rating.

- Balance sheet: still not very strong to me but should have £1.5m extra cash at interims so in calander terms now. On Greengiant's reasoning I really think he/she must be wrong. How can a creditor be deferred income. It is just plain illogical. A creditor is someone you owe money to such as staff for wages. Sales made but for which cash has not been received are debtors. So £3m of the £5m of creditors due in one year just can't be an asset it is a liability. That is really basic and I just think Greengiant must be wrong. It is like saying someone I owe £3 to is really someone who will pay me £3. So in my view balance sheet isn't top quality but is good quality. It does have no real long-term debt and could have net cash of £3m in calander 12 months which would provide a good cushion.

- Earnings: yes removing goodwill amortisation does improve them somewhat. I think tax charge is increasing as well though from 19% to 25% in 05 and may increase further to 33% so this will stunt earnings growth.

Glasshalfull - Yes all in all I do like it but just doing me homework.

Other cautionary notes are that they have only announced two contract wins with each being £400,000 - why no others in H2 which is the seasonally strong period for software companies especially as there was a six-figures contract in H1 according to the interims. But presumably they can have a spat of smaller contracts.

Still researching so will post further things in the future.

Slap