Stockprowler’s pick this week...
CareDecision Corp. (OTC BB: CDED)
2660 Townsgate Rd., Suite 300
Westlake Village, CA. 91361
Phone: 805-446-1973
Corporate Web Site:
http://www.caredecision.net
Shares Outstanding: 121.1 million
Public Float: 30 million (estimated)
Market Capitalization: $ 7.3 million
Closing Price Friday 1/30/04: 6 cents
I don’t have to tell Stockprowler followers that January was a very good month. Anyone who bought the January pick after our profile report had an opportunity to make a nice profit. PlanetLink Communications, Inc. (OTC BB: PLKC) climbed as high as 21.5 cents in the weeks after our report … 877% higher than the closing price on the Friday prior to our report!
And, although that is a difficult act to follow, we believe our pick for the month of February 2004, CareDecision Corp. (OTC BB: CDED) could be even bigger! With the demand for Wi-Fi Internet applications expected to grow 1000% over the next three years, CareDecision's PDA Wi-Fi products offer patent pending solutions for the lodging, satellite media, and medical/e-health markets that are truly innovative.
On January 13, 2004 CareDecision Corp. reported that it has begun the commercial deployment of its Wi-Fi ResidenceWare™ product, beginning with approximately 480 units at nine hotels in the Midwest. The company’s ResidenceWare™ is a proprietary, patent-pending Wi-Fi product for hotels and motels furnishing electronic connectivity solutions across multiple markets. ResidenceWare™ provides hotel and motel owner/operators with a value-added array of Wi-Fi electronic features that enhance the quality of the service offerings to their guests, and also represents a recurring source of cooperative revenue through local advertising fees, transaction fees, and rental Internet connections. Hotel guests can choose from a broad menu of information, local services, travel, business conveniences, food deliveries and more via proprietary Wi-Fi powered PDAs. The ResidenceWare™ PDAs are physically affixed within the guest rooms at client hotels. Each network yields a monthly volume of electronic transactions from local merchants, broadband Internet connection revenues, local advertising revenue bases and revenues from other convenience services.
Navin Patel, the owner of 18 hotels that recently placed orders for the ResidenceWare™, product commented, “Many of us in the hotel business believe that the only way to make an extra dollar is by cutting expenses. But, by introducing this unique product everything has changed. My hotels have over 1100 rooms and we estimate, as a direct result of ResidenceWare™, an annual transaction revenue stream of almost $550,000 across my 18 hotels. With CareDecision's Co-op Ad revenue-sharing program, each of my hotels should add profits, and I can still save an extra dollar or two by cutting expenses elsewhere.”
Robert Cox, Chairman of CareDecision Corp., commented, “Our ResidenceWare™ product has been enthusiastically received by hotels throughout the Midwest. As we secure this beachhead of business, we can shortly turn our attention to the southeastern states and to California. Our recently announced credit facility has been of immeasurable help in this regard. With a second credit facility in the works, we plan more revenue implementation announcements in the near future.” CareDecision’s marketing initiative has resulted in orders and contracts from leading hostelries, including Ramada, Super 8, TraveLodge and Wingate, worth an estimated $3.3 million annually from 2004-2006.
On December 30, 2003, CareDecision Corp. reported that it has executed a Merchant Banking Agreement with Armada Group USA, Inc. and is implementing the first of an anticipated three secured, non-dilutive credit facilities that could total more than $3 million. The agreement also calls for Armada to assume a leadership role on behalf of CareDecision as it enters the closure phase on its agenda of initiatives. These include a $2-$3 million credit facility for the Company's ResidenceWare products, as well as anticipated alliances with a large satellite media concern. The Company is using this initial credit facility for the financing of the existing backlog that recently grew to 26 hotel contracts representing the installation of ResidenceWare™ Wi-Fi units to more than 1,600 hotel guestrooms - and an additional 6,700 guestrooms if follow-on hotels are installed.
The company has selected Dell to furnish its Axim X5 Handheld and its PowerEdge Servers. Linksys, a division of Cisco Systems, Inc., has been chosen for its Wireless-G Broadband Router and its instant Wireless Network CF Card. Keith Berman, founder and CTO of CareDecision Corp. commented, “The product selections place us on the brink of initiating a flood of Wi-Fi ResidenceWare™ system installations to existing contracted hotels, and to additional hotels in the order pipeline. This large 4th quarter roll-out will quickly move CareDecision into this virtually untapped market and activate a steady stream of progressive revenues that will hopefully permit a sooner than expected fulfillment of our long anticipated positive earnings objective.” Mr. Berman concluded, “CareDecision has already been identified as the industry pioneer. We envision being eventually recognized as the dominant provider of Wi-Fi PDA based electronic services to the broad hotel/motel industry. Our market success with ResidenceWare™ is inexorably linked to the feature depth, ease of use and durability of the hardware and associated components.”
On January 21, 2004 CareDecision Corp. announced it has received several offers for the acquisition of, or rights to, its e-health technologies, software applications and other medically-related intellectual properties. The Company reports that the offers received for its three major medical IT properties, if taken at their highest values, would aggregate in excess of $6 million. CareDecision Chairman Robert Cox commented, “The current offers under review value our medical technology at approximately $.05 per share. These bids, which are unsolicited, are for assets that are not part of the Company's current core businesses. The assets that underlie our core businesses would remain totally intact. It is clear to us that our attributes have not gone unrecognized in the e-health sector…”
CareDecision Corp. is currently in due diligence discussions with Texas-based MDU Services, Inc. The acquisition of MDUS would add to CareDecision's asset and customer revenue bases, provide complimentary security services and coveted European venture partners. MDUS provides private smart buildings, switched fast Ethernet, Wi-Fi Hot Spots, and voice, data and TV services to multiple tenant business and residential building sites, hotels/motels, managed care facilities and universities.
The lodging business is highly competitive. When one hotel/motel chain adopts and implements a new innovation others are forced to quickly follow or face losing market share. CareDecision Corp. is the first to get to market with its proprietary and unique information technology/network. The recent trickle of orders for its ResidenceWare™ product may soon become a flood as competitors in the lodging industry realize they must have what the competition has. CareDecision Corp. projected revenues of $15 million for 2004 could prove to be conservative.
Stockprowler’s prediction for shares of CDED is 20 cents short term. Long term we could be talking dollars/share… not pennies. The odds are good that CDED will soon be showing up on the radar of the bigger industry movers and shakers making CDED a likely acquisition target. This could turn out be one of the big plays of 2004. Please remember that trading in shares of CDED could be very volatile due to the highly speculative nature of this stock and the small float relative to the OTC BB.
Stockprowler does not receive compensation from companies we profile or from third parties… we never have and never will. We use our own money when we buy stocks, and even though we usually take a position in a stock before we profile a company, our purchases are always relatively small so that the chance of having an effect on a stock’s price when we buy or sell is negligible. Please read our full disclaimer.
Also, contrary to a commonly held belief, Stockprowler does not have access to insider information, nor do we want to, because trading on insider information is illegal! All information contained in our reports is available in the public record… and any written or verbal communication with company CEOs/ IR people strictly adheres to this rule. Readers are urged to read the company SEC filings and do their own due diligence before investing in this or any other stock.
Good Trading… Stockprowler
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ITEM 9. REGULATION FD DISCLOSURE
CareDecision Corp. [OTCBB: CDED] is in discussions with a media and commercial satellite broadcast concern for a series of revenue-generating agreements covering the product sale, marketing, service and additional projects based on its SateLink Satellite Wi-Fi technologies. CareDecision's SateLink provides wireless satellite communication, programming and data integration, and e-transaction processing applications, all through Wi-Fi and satellite- enabled PDAs.
"We have been in discussions over the past four months with a media company concerning a series of agreements related to the marketing, servicing and additional projects based on our Satelink technologies. The functionality of the product for this contemplated joint venture has been determined and the intellectual properties secured. Recently, we reached a stage in our talks where it is prudent to offer a short exclusive negotiating period in an effort to conclude a prompt and successful conclusion," said Robert Cox, CareDecision Chairman. The Company expects to have more to report in coming days.
Date: January 15, 2004.
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ITEM 9. REGULATION FD DISCLOSURE
CareDecision Corporation (the "Company") [OTCBB: CDED] reported on January 21, 2004 that the Company has received several unsolicited offers for the acquisition of, or rights to, our e-health technologies, software applications and other medically related intellectual properties that are not part of the Company's current core businesses. The offers for our three major medical IT properties, if taken at their highest values, would aggregate in excess of $6 million. In addition to the current bids under review, the Company has also been notified that additional proposed transactions may be forthcoming.
It is the belief of the Company's Board of Directors that the current bids, do not accurately reflect the present value of these properties. The turn-around in the e-health sector, coupled with a recent announcement by a large health insurer regarding a large-scale implementation of e-health PDA based technologies, and the Company's multiple patents pending, have led the Board to conclude that these properties would be more accurately valued in excess of $10 million. Thus, we have asked the Chairman of the Board to seek the services of an investment banker to help the Company maximize the prospective highest sale value of these properties.
Date: January 29, 2004.
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