NETeller - NLR - 3.15
Thought i would start a new thread following on from
hawick - new issue looks very special - not to steal the thunder from
hawick but just to highlight the company name to those not already in to this
potential blockbuster.
Those of us who are following NETeller know the background and have been
active with postings,for newcomers i strongly sugest viewing the
( new issue looks very special posting )the content will speak for itself.

Brief overview of NETeller
The company handles online cash transactions across the globe
on 21st oct gained fsa approval to operate as a regulated e-money issuer
and will passport the regulated status to all 25 EU member states
it has over 1 million clients rising by 2000 number each day
1500 online merchants and processed over $1.5 billion in 2003
pre tax profit is estimated to be 29 million to dec 04 rising to
40 million next year
per currently 20 to dec 04 falling to 11.5 which is low for sector
brokers have been raising forcasts on a regular basis
share price has risen over 50% since launch earlier this year
new markets emerging constantly,asia has the potential for supergrowth
online casinos are creating enormous profits
given all this - cash generative - huge market - fsa approval
infastructure in place to handle growth, profits accrue to bottom line
the market force is behind it with good relative strength
all put together it is hard to argue against this has the potential
to be a blockbuster over the year ahead

regards HUSTLER

From Citywire this morning.....................

The CFDealer: Missed Sportingbet? Try this instead

Published: 10:42 Tuesday 01 February 2005
By: Graeme Dickson, Head of trading, Simple CFDs:

Related Articles
Shrewd Tip: time for Sportingbet:
08:04 Mon 07 June 2004 read

If you think you missed out on the meteoric rise of online gambling firm Sportingbet then NETeller may give you a second chance.

Although its market size is in excess of 500 million, NETeller (NLR) could still attract a high initial margin rate from some contracts for difference (CFD) providers of up to 35%.

A couple of weeks ago I wrote that coal and uranium were the sectors to be in for 2005. Well I want to add one more to that list: online poker.

It is highly probable that half of Sportingbet's rise - it is up 155% since Citywire tipped it at 94p in June last year - can be attributed to its acquisition of Paradise Poker in October. It was only last week that we heard PartyGaming, who own the PartyPoker.com website and Cassava, owner of 888.com are sounding out potential listings on the LSE, probably straight into the FTSE 100. The US market alone for online gaming is expected to grow from $6 billion (3.2 billion) to more than $15 billion in 2006. NETeller facilitates online money transfers in the gaming sector, unlike credit card companies along with PayPal who refuse to serve this sector.

It settles in multiple currencies, guarantees payment to the website owner and has single-point accounting approved by the Financial Services Authority. Now that it has conquered the gaming sector - major clients include PartyGaming, Cassava, Sportingbet and William Hill - it intends to become the world's leading internet bank by branching into other areas, providing payment facilities to the likes of the online travel industry and the online broking markets.

NETeller is trading on forward 2006 price earnings ratio (p/e) of just 9. Given the high initial margin and the recent strong rise in its share price it would be sensible to go long now by half or even a quarter of your normal dealing size with a view to buying the balance should the stock fall to about the mid 4 level.

In a previous column I wrote watch this space for Cambrian Mining (CBM) among a few others. You can trade Cambrian on a CFD at 40% initial margin or better.

Cambrian seems to have recently bottomed out at the 210-213p level and after seeing this morning's rise on Asia Energy (AEN) along with Western Canadian (WTN), of which it owns 27% and 42% respectively, it may spur fresh buying for the next leg up. The company, which has a strong bias towards the coal sector, recently raised 12 million through an institutional placing to maintain its strong interest in Western Canadian.

Some brokers calculate its net asset value (NAV) to be in excess of 300p a share and the argument is that this differential between the current share price and NAV should be narrowed. I agree with this analysis and suggest long positions around the 220p level.

In view that Cambrian and NETeller are AIM listed you may find some CFD providers will refuse to deal in them. However, most clearing brokers will deal a wide range of UK companies with some going as low as 10 million in terms of market capitalisation.

The trade-off here is initial margin; the bigger the stock, the less is required as a deposit for the trade. It is therefore normally wise that whenever you are dealing in high initial margin stocks you should reduce your typical trading size so as to adjust for the volatility associated with smaller companies and to allow enough room to deal in other situations as and when they arise.

cheers GF.

goldfinger

Thanks for a valuable post. I do trade CFDs (and acquired my NLR stake that way) but don't get the meaning of "the 35% initial margin rate". Do you? On second thoughts, it could well be the times your stake is covered by cash or other, more stable, CFDs?

Eric

Mentions share to watch NLR in today's Daily Mail--I haven't seen it anyone to tell us what it says please?

moneyplus
Quote from Daily Mail today
Keep a close eye on NETTeller,up 39p to 512.5.
It specialises in online wallets used by internet gamblers
who spend heavily online.The company which was boosted by a positive
note from broker Durlacher last week , aslo has an online banking
licence in its pocket.
Rumours floated round the market that it is in talks with a small
European bank with a view to an acquisition.End quote

regards HUSTLER

Yes moneyplus ,,,The company which was boosted by a positive notefrom broker Durlacher last week also has an online banking licence in its pocket..Rumours floated around the marketthat it is in talks with a small European bank with a view to an acquisition...
Im staying in despite the lull..

Daily Mail Market report by Edmund Conway,

"Keep a close eye on NETeller, up 39p to 512 1/2p. It specialises in online wallets used by internet gamblers who spend heavily on line.
The companywhich was boosted by a positive note from broker Durlacher last week, also has an online banking licence in its pocket.
Rumoursfloated round the marketthat it is in talkswith a small European bank with a view to an acquisition". ENDS. SD

Looks like we all replied together mp
spoilt for choice

regards HUSTLER

Thank you very much all--all good for the SP. cheers MP

Started out well today up 20 to 5.32 soon after opening
huge trade over 1.6m shares over 8m went through looks
like a broker trade not sure anyone with more info ???
this trade reversed trend now standing off 2p at 5.07 bid
at time of posting
report in daily mail today interesting, read previous posts
looking to purchase bank, this would be a huge step forward
in securing links to asia markets.

Regards HUSTLER

For the record, I understand that The Poker Channel will start on the Sky TV Network mid March 2005. That should encourage plenty more willing donors to the internet tables which is good news for me (the poker newbies are easy prey) and good news for NLR and SBT. Also, don't forget William Hill and Ladbrokes who have big flourishing poker sites already.

Got shaken out of Logica a few years ago --up21k-- lost 10 -- given the future NLR has -- not placing a stop here -- just watching from PC in tea-breaks at work!!!

Up again 10p what else should we expect.

cheers GF.

Still moving up but a lot of investors think that they would be getting in at the tail end if they bought now. WRONG, I think this ones got a lot further to go. Sure itl have down days but the business is growing so fast alongside the online gaming industry and basicaly everything else online where NLR is hoping to diversify.

cheers GF.

I agree goldfinger, i bought more when they dipped yesterday,,im staying in with this one,

Quantum leap - tip sheet out today
NETeller main tip at 5.12
we normally ask who is tipping what
with this one we are asking who is'nt tipping it
seems everybody is behind it now
nobody is negative - scary
loads further to go

regards HUSTLER

Marvellous charts. 7 - here we come!

Eric

Early doors Eric 7 to cheap
double figures soon

regards HUSTLER

Another great start to the day for this,

Going like the clappers and like I have said before not too late to get aboard far from it.

cheers GF.

Now CityWire have tipped it and joined the party.......

[b]Shrewd Tip: top investors gamble on Neteller[/b]

Published: 07:00 Thursday 03 February 2005 By: Graeme Davies, Investment Correspondent



Shrewd investors continue to buy into real-time payments specialist Neteller despite a doubling in its share price in less than a year.

Neteller (NLR) offers an indirect way to profit from the boom in online gaming, particularly poker. It specialises in secure, instant online money transfers and has focused on serving the online gaming industry. This industry has exploded over the past few years with online poker proving particularly popular.

As a result of the huge surge in online gaming Neteller's business is growing rapidly. Its share price has reacted sharply with a rise from a low of 157p shortly after its float last year to a new high of 526.5p today, up 14p.

However this rise has not put top investors off piling in as recently as the last week of January when Framlington's AAA-rated Roger Whiteoak snapped up 50,000 shares for his Framlington UK Smaller Companies fund (Framlington UK Smaller Companies Acc). He now holds 423,000 shares in this fund and a further 1.3 million in the Throgmorton investment trust (THRG).

His fellow AAA-rated manager Dan Nickols also holds 345,000 shares in the Old Mutual UK Select Smaller Companies unit trust (Old Mutual UK Select Smaller Companies Acc) having bought 65,000 shares two weeks ago. Rathbone's A-rated Carl Stick holds 250,000 in the Rathbone Special Situation fund (Rathbone Special Situations) but has not added any since early November.

Users of Neteller deposit money into their e-wallet account then withdraw and transfer funds to any merchant or internet site which supports its technology. Individuals must provide strict identity criteria to qualify to use Neteller. Merchants are indemnified against losses thus cutting out the risk from their end and Neteller users do not have to send personal information over the internet.

The security measures in Neteller's system mean it can transfer funds instantly with very little incidence of losses. The company has also received the stamp of approval from the Financial Services Authority to operate as a bank in the UK, which has allowed it to transfer all its operations to the Isle of Man. It will now benefit from a 10% tax rate instead of the previous 33% it was paying. Its next step will be to tie up with an Asian bank to crack the lucrative online payments market over there.

Neteller is scheduled to issue fourth quarter results in the coming weeks. At the end of the third quarter it passed the million mark in its membership and was signing up 2,085 members a day on average, up 87% from the same time the previous year. Revenues for the year to that date were up 137% and pre-tax income was ahead by 134%. At the interim stage Neteller reckoned it was making $0.11 revenue for every $1 deposited.

Despite its focus on the online gaming market Neteller also provides payments for online purchases from various retailers and also allows for instant money transfer between two individual Neteller e-wallet holders. It charges a small fee for transactions and with the number of transactions it carries out growing rapidly compared with its capital expenditure profits should surge.

In the online gambling world Neteller has already signed up William Hill, Ladbrokes, Victor Chandler, Sportingbet, BetonSports and PartyPoker among its many clients. Its rivals have been rather shy when it comes to the gaming industry with Paypal not serving the industry and others such as Firepay and Click2pay not offering instant indemnified funds to merchants.

The global online gaming market was worth more than $6 billion (3.19 billion) in 2004 and is predicted to more than double to $15 billion by 2006 as access becomes easier through handheld devices and television.

For investors who feel they have missed out on the success stories of the online gaming world such as Sportingbet, Neteller could provide a novel way of plugging into the stunning growth in this sector. There is always the risk most of the growth in the share price has gone but with top investors such as Whiteoak and Nickols still buying investors with a healthy appetite for risk may want to follow suit. Buy.

cheers GF.