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EnigmaDude (87.06)

TSYS gets some sugar

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8

October 06, 2010 – Comments (5) | RELATED TICKERS: TSYS

If you have not heard the news yet, the Marines need to chat.  So they awarded a $269M contract to TeleCommunication Systems, Inc.  (TSYS).  Their market cap is only $250M so this is a big deal for them.

The news has caused their shares to soar by as much as 25% today.  The stock still has a long way to go so if you have not yet joined the party it is probably not too late!

5 Comments – Post Your Own

#1) On October 06, 2010 at 10:11 AM, TMFBabo (100.00) wrote:

TSYS became my favorite stock over the past 3 months and I even gave it a "top pick" designation a few weeks ago to make it my 3rd such stock.  I agree with you that there is plenty of room to run.  It's my biggest holding and I don't think a trip back to $9 within a year or two is unreasonable.

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#2) On October 06, 2010 at 11:00 AM, EnigmaDude (87.06) wrote:

BB - I noticed that you made this a top pick.  Hope you got in at a good price!  I have a small position in real life.  First came across this stock 3 years ago and watched it rise from less than $5 up to 9+.  And that was during the big market crash! 

So yes, I agree.  It is not at all unreasonable to expect this to go much higher over the next several months/years.  Several other top CAPS players also picked it to outperform.

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#3) On October 06, 2010 at 11:24 AM, TMFBabo (100.00) wrote:

I started buying at $3.35 down to $3.10 or so.  My initial buying was heavier, so my cost basis is about $3.25.  I built a pretty large position.

I saw a rapidly growing technology company that sold mainly to wireless carriers and DoD competing in markets that will expand by a good amount regardless of GDP growth that had dropped 70+ percent.  

My initial thoughts were to sell between $7.50 and $9.00, but I'm going to see what kinds of impacts the new backlog has on earnings.  Government sales typically have a 6-9 month deliverable timeframe, if you go by what Tom Brandt (CFO) said in the Q2 earnings call. That would mean the full impact of this latest contract won't be seen till the Q2 2011 earnings come out.

The backlog was very strong as of Q2 2010, so I believe we're in for good earnings in Q4 2010 and Q1 2011 anyway.  Q2 2010 will just continue the strong growth in my opinion.

If growth is better than my expectations, I may hold this one for the long haul and hope for multiple bags. In CAPS, I intend to hold my pick open till at least 3-4 bags.  

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#4) On October 06, 2010 at 11:26 AM, EPS100Momentum (72.66) wrote:

Stay away from TSYS

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#5) On October 06, 2010 at 5:38 PM, simplemts (< 20) wrote:

Very informative EPS.  Thanks for thorough, objective analysis.

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