TZL - TZ Limited

[Eddyl]

I don't understand why DKR would want to sell the converted bonds? Wouldn't they want to hold onto more shares, if the prospects of this company are to be believed.

 

[shaunm]

Perhaps they are happy to take a short term profit, perhaps they don't focus on long term.
I hope they sell them as I and quite a few others wouldn't mind picking them up, at the right price of course (under $5 is nice).

 

[Pommiegranite]

Perhaps they are happy to take a short term profit, perhaps they don't focus on long term.
I hope they sell them as I and quite a few others wouldn't mind picking them up, at the right price of course (under $5 is nice).

Exactly Shaunm. Hedge funds think in different ways to you and I.

This is going to be a VERY interesting month.

 

[Eddyl]

Does anybody have a heads up on when TZL will delist from the ASX and commence listment on the NASDAQ? Must be anyday now?

Similarly alot of people seem to talk about contracts with big companies (boeing etc), but, alot of this is not directly released to the market via company announcements. Instead its based of alot of hear say from what I gather. Thoughts?

 

[shaunm]

Some people are suggesting that they aren't releasing these announcements as the customers are requesting confidentiality for being early adoptes of the technology.
Ohers are suggesting they are keeping the announcements quiet until the likes of DKR have decided what they will do with their remaining shares.
Who knows?????

 

[Pommiegranite]

http://www.marketheadquarters.net

Interview with David Feber just released. He answers all of those questions, and if his prediction of aquiring several % of a $50billion market over the next few years are fulfilled, then we are talking a share price of between $500-$1000. (Personally, I believe he is being conservative)

If you want to accuse anyone of ramping....accuse the CEO!

 

[grace]

http://www.marketheadquarters.net

If you want to accuse anyone of ramping....accuse the CEO!

CEO hoping to achieve turnover in the billions per year. The interview was very bullish indeed. TZ technology can be applied in just about anything, and that is I guess the strenght of the company.

CEO mentioned that Australian's are not big on technology companies, and should get more recognition in America.....hope so!

We must be close to a nasdaq announcement, otherwise, won't make it before Christmas. I disclose holdings for some 2 years I guess.....

 

[Pommiegranite]

CEO hoping to achieve turnover in the billions per year. The interview was very bullish indeed. TZ technology can be applied in just about anything, and that is I guess the strenght of the company.

CEO mentioned that Australian's are not big on technology companies, and should get more recognition in America.....hope so!

We must be close to a nasdaq announcement, otherwise, won't make it before Christmas. I disclose holdings for some 2 years I guess.....

Not long now Grace. Soon, those with the vision to look beyond the resource sector will be rewarded in a way that no resource stock can.

It was good to hear DF reiterate that the present economic conditions do not negatively affect TZ's business model due to Intevia impriving effieciency, lower costs, security requirements, and a reduction in complexity.

 

[YELNATS]

http://www.marketheadquarters.net

then we are talking a share price of between $500-$1000. (Personally, I believe he is being conservative)

Interesting price forecast Pommie, is this based on the possibility of a share consolidation when the transfer to Nasdaq occurs. ie. 1 for 5 or 1 for 10, etc.? eg. if you hold 500 shares now you may end up with 100 or 50 on Nasdaq.

Sometimes companies on the US exchanges like to have their shares quoted in multiples of US$10 for corporate prestige reasons.

I hold TZL and always interested in your comments.

 

[Pommiegranite]

Interesting price forecast Pommie, is this based on the possibility of a share consolidation when the transfer to Nasdaq occurs. ie. 1 for 5 or 1 for 10, etc.? eg. if you hold 500 shares now you may end up with 100 or 50 on Nasdaq.

Sometimes companies on the US exchanges like to have their shares quoted in multiples of US$10 for corporate prestige reasons.

I hold TZL and always interested in your comments.

This is not my forecast. They are just figures extrapolated from David Feber's comments. No I have not based them on any share consolidation on share split.

Have you listened to the interview?

DF has also gone as far as saying that the reason why the SP is languishing is that tech stocks just aren't appreciated on the ASX. He also said it is a great opportunity for investors to get in at the bottom.

 

[YELNATS]

This is not my forecast. They are just figures extrapolated from David Feber's comments. No I have not based them on any share consolidation on share split.

Have you listened to the interview?

Hi Pommie, yes I did listen to the David Feber interview which, unless I missed it, didn't include any comment about possible share prices.

I'm just a little intrigued by the forecast of a $500 - $1000 share price and by which process of "extrapolation" it was arrived at.

On the subject of share prices, I note that back in January you mentioned,

Quote:

I would expect that by the next quaterterly research report from Duttons, this price target would be revised to $30+, as a 'Strong buy' as opposed to 'Strong speculative buy'.

Unquote.

I'm not trying to deny the possibility of a $500 - $1000 sp, I'm just interested in the logic of it all.

regards YN

 

[Pommiegranite]

Hi Pommie, yes I did listen to the David Feber interview which, unless I missed it, didn't include any comment about possible share prices.

I'm just a little intrigued by the forecast of a $500 - $1000 share price and by which process of "extrapolation" it was arrived at.

On the subject of share prices, I note that back in January you mentioned,

Quote:

I would expect that by the next quaterterly research report from Duttons, this price target would be revised to $30+, as a 'Strong buy' as opposed to 'Strong speculative buy'.

Unquote.

I'm not trying to deny the possibility of a $500 - $1000 sp, I'm just interested in the logic of it all.

regards YN

Yelnats,

Firstly, usually any managment of any company wouldn't be so naive as to give SP targets. As we all know, the share price of any company is at the mercy of macro views such as recession/depression/price of oil/housing market/credit crunch..etc etc

Management have no control over how the public control their emotions.

All of the above affects the forward p/e of a company i.e how many times forecast earnings investors are prepared to pay.

So, on that basis, all management can talk is about their own specific business i.e what they forecast to capture in revenue/profit. From this we can estimate what p/e the market will assign to the nature of a company and then work out a share price target

Forecast Net Profit / Shares on Issue X Forecast Price Earnings Ratio = Share Price

So to work out the Forecast Net Profit, we were given a clue by David Feber.

He said that he expects TZ to capture several % of a $50 billion per annum market within several years.

What does he mean by the word several? Does he mean '3' or does he mean '9'? I would guess anywhere in between as he has no way of knowing for sure. Let's assume he means 5% in 5 years.

Also note that his $50 billion market is from an outdated but very detailed piece of research by the Freedonia group in 2004. In this report it stated that the market was growing at 4.8% per annum through to 2013.

That would mean the market in 5 years from now would be closer to $76billion.

Now if TZ capture this 'several'% ('5'%) of this market by 2013, it would mean that TZ would generate around $3.8billion in 2013.

So if we assume that 1/3 of this $3.8billion is our net profit (could be higher as Intevia is a very high margin product), then we have a net profit of $1.27 billion.

$1.27 billion / 70million shares (Increase on current registry) x Forecast P/E of 40 (Tech average for mature company - Google has a p/e of 50) = Share price of $726 US

The big question is how much is several. Could it mean TZ capture 9% over 3 years, or 3% over 9 years?

Either way we end up with a share price in the hundreds and likely hundreds times current share price.

 

[Sean K]

$1.27 billion / 70million shares (Increase on current registry) x Forecast P/E of 40 (Tech average for mature company - Google has a p/e of 50) = Share price of $726 US

PG, my only issue is with the dilution factor of the company at this point. By the time it actually gets to making any money won't it have diluted somewhat more?

(Disclaimer: I have read the last 5 posts and know nothing of the company. Yet.)

 

[Eddyl]

I think one of the problems pommie is that you are being very aggressive in your estimates. Several is more likely to mean 3% than 5%... CEO are generally more optimistic about their prospects then the market.

Similarly, google is an international widely known company, TZ Limited will never be this. Even if it becomes the largest supplier of intelligent fastening, it will not be a household brand, I would not apply a 40 p/e ratio to the company. You are probably better applying a P/e of a start up on the nasdaq, as this is what the company will be.


Similarly the size of the market you suggest is definately going to be impacted by marco factors as you suggest. Yes TZ Limited will save money, but larger companies will produce less in an economic slow down, whether it be doors or planes. This means that the industry as a whole will shrink... it may not effect the percent of the industry TZL catch, but it will effect the size of the industry as whole.

Similarly, you say the product works on a high margin. How is this margin affected by rising commodity prices? Moreover where are you actually drawing these margins from?

Lastly have you considered that like with any tech stock, unless you can constantly innovate, you will not stay ahead of the game. It is simple economic theory, if there is a market where massive profits are being made, suppliers will quickly switch into this industry. Yes they might provide inferior items to TZL and yes they might lose the first mover advantages. But the important thing to consider is it is very hard to predict the success of tech stocks moving forward, because they do rely on this constant innovation. This is not to say TZL cannot but it will not be as smooth sailing as you suggest.

All in all, I hold TZL. I believe in the company, and I believe the nasdaq listing will be a good thing. I'm hoping for a stock price of $10, which I would welcome from their current price of $4. However Pommie, and I mean this in offence, because you seem one of the best research people on this thread about the company, you do have a tendency to overstate the benefits of TZL.

 

[Pommiegranite]

PG, my only issue is with the dilution factor of the company at this point. By the time it actually gets to making any money won't it have diluted somewhat more?

(Disclaimer: I have read the last 5 posts and know nothing of the company. Yet.)

Kennas, currently there are 45 million shares on issue. Fully diluted, I believe we are looking at 55million. I used 70million to take care of any further dilution i.e IPO and further employee options.

One thing we have to remember is that from next month, TZ will be generating its own revenue (if it hasn't already from Intevia Enterprise).

This is not like a resource stock where there are huge capital outlays until revenue can be generated in future years.


Eddyl, regarding you post: theres one thing having an opinion (which is fine) or asking a questions, but theres another when it is posted in a manner which demonstrates lack of understanding and unwillingness to understand at the same time.

You obviously have no idea of what a p/e actually is, let alone on a high growth tech stocks. Perhaps....we should apply a P/E of around 200 such as First Solar, which is not a household name either?

Generally high growth stocks have very high p/e upon initial take up by the market (as everyone wants a piece of the cake early), only to drift down as the stock matures. You seem to think a p/e develops in the opposite direction...very strange!

Margins...If you read the company announcements, you would have your answer. Read them...and then question me. The market can make mincemeat out of people who don't do their own research.

No..TZ won't be a household name. I wan't aware it has to be to be successful. Who's the leading nut and bolt manufacturer? You don't know? I guess that means you don't believe nuts and bolts are successful products?

Regarding your question on competitivness..HAVE YOU DONE ANY RESEARCH WHASOEVER??? Even the last announcement (interview) will tell you that there are several hundred patents in place.

Eddyl....seriously dude....you can only truly find comfort with your investment it you do some research. Happy reading

 

[Eddyl]

Hi Pommie,

I did not mean to get you angry. Just some observations and I guess a bit of devils advocate. However, I still maintain that alot of your views seem to only see TZL in rose coloured glasses.

I'm slightly offended you make the assumption that I have not done my research. I would not have invested my hard won capital if this was not the case.
To address your post in sections I'll begin:
1) P/e ratio.
I am very familiar with what a P/E ratio is, and its defintion. However, maybe I was being ambiguous in my point. So I'll restate it differently, Google and TZL are not the same company... you cannot make comparisons of fundametal ratios based on companies which are in no way similar other than they are both listed on the NASDAQ and both tech stocks. You need to compare apples to apples. Make this assumption based on other intelligent fastening companies, or something in their vein.

They make a very similar point here:
http://www.investopedia.com/terms/p/price-earningsratio.asp

"However, the P/E ratio doesn't tell us the whole story by itself. It's usually more useful to compare the P/E ratios of one company to other companies in the same industry, to the market in general or against the company's own historical P/E. It would not be useful for investors using the P/E ratio as a basis for their investment to compare the P/E of a technology company (high P/E) to a utility company (low P/E) as each industry has much different growth prospects. "

2) My question about margins was based on the fundamental principle that TZL has not yet released to the market very much about the real margins it will make with intevia. Last year it had a trading revenue of 15,865,000 for instance. It is a long jump to a billion per year. Its earnings per share were -30.25 cents.
My criticism of your analysis was that you are basing alot of it off conjecture, and media interviews from the CEO. Alot of TZ's success is yet to be proven, and your sources do not seem the most reliable.

3)Similarly, a tech stock to be successful over the long term has to be innovative. This is exactly what companies such as google have done. Just look at the gamut of products they have released to the market. I am aware that TZL have patents, but like all patents these run out, depending on where the patent exists it does not protect the idea internationally.
I suggest you do somemore reading on patents at a cursory level here.
http://www.ipaustralia.gov.au/patents/what_innovation.shtml

I once again afirm that I believe in this company and where it will go, but I reiterate that I think you are very aggressive in your predictions for its prospects.

 

[Pommiegranite]

Hi Pommie,

I did not mean to get you angry. Just some observations and I guess a bit of devils advocate. However, I still maintain that alot of your views seem to only see TZL in rose coloured glasses.

I'm slightly offended you make the assumption that I have not done my research. I would not have invested my hard won capital if this was not the case. .

You have either done no research or really just don't get it. It's not that difficult mate.

To address your post in sections I'll begin:
1) P/e ratio.
I am very familiar with what a P/E ratio is, and its defintion. However, maybe I was being ambiguous in my point. So I'll restate it differently, Google and TZL are not the same company... you cannot make comparisons of fundametal ratios based on companies which are in no way similar other than they are both listed on the NASDAQ and both tech stocks. You need to compare apples to apples. Make this assumption based on other intelligent fastening companies, or something in their vein.

They make a very similar point here:
http://www.investopedia.com/terms/p/price-earningsratio.asp

"However, the P/E ratio doesn't tell us the whole story by itself. It's usually more useful to compare the P/E ratios of one company to other companies in the same industry, to the market in general or against the company's own historical P/E. It would not be useful for investors using the P/E ratio as a basis for their investment to compare the P/E of a technology company (high P/E) to a utility company (low P/E) as each industry has much different growth prospects. "

.

Lol..thanks for the investopedia link. I'll save it in my favourites. Your points are ridiculous. TZ are a tech stock. Google is a tech stock. The p/e is assigned by the market based on future earning potential. Have a look at what p/e's high growth tech stocks command.

As for comments about comparing TZ to other Intelligent fastening companies...this point proves that you just don't get it. Can anyone else enlighten this unenlightenable person?

2) My question about margins was based on the fundamental principle that TZL has not yet released to the market very much about the real margins it will make with intevia. Last year it had a trading revenue of 15,865,000 for instance. It is a long jump to a billion per year. Its earnings per share were -30.25 cents.
My criticism of your analysis was that you are basing alot of it off conjecture, and media interviews from the CEO. Alot of TZ's success is yet to be proven, and your sources do not seem the most reliable.
.

So you base future performance of a new technology on past financial success? How freaking ridiculous can you get. In that way no invention/idea would ever gain traction. Next you'll be telling us that Microsoft were a $billion company since before the advent of money.

3)Similarly, a tech stock to be successful over the long term has to be innovative. This is exactly what companies such as google have done. Just look at the gamut of products they have released to the market. I am aware that TZL have patents, but like all patents these run out, depending on where the patent exists it does not protect the idea internationally.
I suggest you do somemore reading on patents at a cursory level here.
http://www.ipaustralia.gov.au/patents/what_innovation.shtml

.

I suggest you stop suggesting and do some research on TZ's patents, where they are held and how long they are in place for.

I once again afirm that I believe in this company and where it will go, but I reiterate that I think you are very aggressive in your predictions for its prospects.

Eddyl, I truly feel sorry for you. How you can invest in a company which you know nothing about is beyond me. I just hope the penny drops before you get taken to the cleaners.

 

[Eddyl]

Ok first off: unenlightenable, is not actually a word. I thought you could use the help. =) DYOR and all that.


1) "thanks for the investopedia link. I'll save it in my favourites"

You're welcome. The Price to earnings ratio is not a fundamentally complex concept. I can provide you with any number of sources, but they will say the same thing. I'm not sure what you are driving at here?

2)"TZ are a tech stock. Google is a tech stock."
Perhaps you are not getting what I am driving at here.
Google's mission statement: "Google's mission is to organize the world's information and make it universally accessible and useful."
http://www.google.com/corporate/index.html

TZ Limited business summary: The TZ Group maintains its high growth and earning potential through the continuous development and commercialisation of breakthrough technology innovations.
http://www.tzlimited.com/aboutus/
or as aspect huntley defines it's principle activity:
The development and licensing of intellectual property particularly, Intelligent Fastening, Assembly Enabling and FutureWall technologies through Telezygology, Inc; Providing a full service capability in product development and engineering services through PDT Group. Additionally a significant electronic and software engineering capability has been established.

This are fundamentally two very different things. It is hard to compare P/E ratios within the same industry, let alone between two business with very different business models.


3)"Have a look at what p/e's high growth tech stocks command."

I think I have address this above, but lets do case study. Look at Challenger Financial Services Group Limited(CGF) and Perpetual Limited(PPT). Both diversified financials, moreover both largely in the same business. Certainly more so than google and TZL.

P/E of CGF: 6.60
P/E of Perpetual: 14.60

There is a difference in the ratio in the magnitudeof 1:2.21 recurring. These are companies which have a ot more in common than google and TZL.

4) "So you base future performance of a new technology on past financial success?"
I obviously think TZL would be successful or I would not have bought into the company. But I reiterate that TZL has a ot to prove before it is a billion dollar company. First of all becoming a profitable business, and second of all increasing its trading revenue from $15,865,000 to billions of dollars. To give you an example it would have to increase its current trading revenue approximately 6300% to be generating 1 billion dollars.

I am happy to maintain this discussion with you Pommie, as long as it is a discussion and not a personal attack. This is a forum to discuss ideas about TZL. I respect a ot of what you say, there is no need to personally slander me.

Before you play the markets, you might want to first consider investing in a dictionary.

Regards,

Eddy.

 

[Pommiegranite]

Ok first off: unenlightenable, is not actually a word. I thought you could use the help. =) DYOR and all that.


1) "thanks for the investopedia link. I'll save it in my favourites"

You're welcome. The Price to earnings ratio is not a fundamentally complex concept. I can provide you with any number of sources, but they will say the same thing. I'm not sure what you are driving at here?.

What I am driving at here is that the is no need to provide a link to what the definition of P/E is. Thanks for your offer to provide sources, but there is no need as I do know how to work a web browser.

Yes a P/E is not the be all and end all as to what a company is worth. I never said anything different. However, it still the best ratio when viewing sentiment towards a particular stock. Do you have something better which the investment world is not aware of?

2)"TZ are a tech stock. Google is a tech stock."
Perhaps you are not getting what I am driving at here.
Google's mission statement: "Google's mission is to organize the world's information and make it universally accessible and useful."
http://www.google.com/corporate/index.html


TZ Limited business summary: The TZ Group maintains its high growth and earning potential through the continuous development and commercialisation of breakthrough technology innovations.
http://www.tzlimited.com/aboutus/




or as aspect huntley defines it's principle activity:
The development and licensing of intellectual property particularly, Intelligent Fastening, Assembly Enabling and FutureWall technologies through Telezygology, Inc; Providing a full service capability in product development and engineering services through PDT Group. Additionally a significant electronic and software engineering capability has been established.

This are fundamentally two very different things. It is hard to compare P/E ratios within the same industry, let alone between two business with very different business models..

TZ's vision from the 2007 AGM (which by the way is available for those wish to research the company):

A world proliferated with Internet-enabled remotely
controlled intelligent fasteners, locks, latches and
actuators able to sense their environment, control
other circuits and communicate and be managed​

through the Internet all based on TZ’s Intevia ®

products and platforms​

This is in every way as big a vision as Google's. Do Google have competitors? Yes. Do TZ? No​

As for your Aspect Huntley information, seeing it mentions 'Telezygology' it goes to show that it is at least 4 years out of date. But then, you would have known that had you researched the company.​

3)"Have a look at what p/e's high growth tech stocks command."​

I think I have address this above, but lets do case study. Look at Challenger Financial Services Group Limited(CGF) and Perpetual Limited(PPT). Both diversified financials, moreover both largely in the same business. Certainly more so than google and TZL.​

P/E of CGF: 6.60
P/E of Perpetual: 14.60​

There is a difference in the ratio in the magnitudeof 1:2.21 recurring. These are companies which have a ot more in common than google and TZL..

Your 'case study' is typical of your research. It does not take into account age,revenue,profit nor Market Cap. In short your 'case study' is useless.​

I obviously think TZL would be successful or I would not have bought into the company. But I reiterate that TZL has a ot to prove before it is a billion dollar company. First of all becoming a profitable business, and second of all increasing its trading revenue from $15,865,000 to billions of dollars. To give you an example it would have to increase its current trading revenue approximately 6300% to be generating 1 billion dollars..​

AND your point is..that it can't be done? Here's a a few words for when you do eventually get around to doing some research: 'Disruptive Techonology' and 'Ubiquitous Computing'.​

I am happy to maintain this discussion with you Pommie, as long as it is a discussion and not a personal attack. This is a forum to discuss ideas about TZL. I respect a ot of what you say, there is no need to personally slander me.

Eddy, this is not about slandering you. It is about you not having done enough research on TZ before having invested in them. I have given my reasons as to why I have invested in them, and its not to achieve a miserly $10 price target from a stock which aims to have an impact on the way we live our lives.

All of the facts which I have provided are freely available in the public domain. I will happily discuss further once you have read through the announcements.​

 

[Sean K]

Interesting discussion above, and yes, let's continue to be civil.

I note the $15, 12 mth valuation been put on it as a 'strong speculative buy' by some US analyst. I can't seem to actually find the report. Maybe it's in the thread somewhere, will check.

Just throwing around a few S&R lines here and it looks to be tracking generally sidways at the moment between $4.00 and $5.00 with some more recent short term support at $4.50. Will be interesting to see if that upward support line is respected which could drive up through $5.00, but it's a little tenuous. A potential breakout when/if it approached $5.00 again.