iMERGENT, Inc. (IIG)

NetscribeTech (80.04) Submitted: 1/30/07 7:35 AM : Start Price: $18.93 IIG Score: -26.82

iMergent is an e-service company, offering technology and services based on the e-commerce platform to small and medium business and enterprises. The core product offered by the company is Stores Online Software (SOS), which helps the customer to develop a website that can be used for commercial purposes. Other than that, the company also offers web hosting, customer service and support, resources for marketing the website. In short, the company acts as a one-stop shop, by providing all the assistance needed by a client to leverage the e-commerce platform.

The revenue segment reporting is split into two with the revenue from sale of SOS and related services provided by the company labeled as product revenue and the revenue from the third parties who are authorized by the company to assist the customers by servicing termed as commission revenue. The former contributes the major share of the revenue. For the three-month period ended September 06, its revenues increased 153%, endorsing the conversion of some of the free services as chargeable and by increasing the number of seminars and workshops to attract more customers.

Much of the success and the future prospect for e-Commerce companies depend upon the increase in online usage. This growth has been healthy for the past 5 years with the number of the U.S online population reaching 220 million by 2007 and all set to continue. Also more and more companies –especially small and medium – are looking to leverage the e-Commerce medium, which increases the potential for iMergent. The company anticipated this growth in advance and responded by converting some of its services from free to paid. This measure along with the robust external growth will propel the stock price of the company to new heights.

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