Micro CAP. RESEARCH REPORT
BUY Recommendation
February 18th, 1998
Technologies Corp.6 Pearl CourtAllendale,NJ 07401 (201) 818-2889
|
 |
4.53 Million.Estimated Float: 2 Million Recent Price: $2.875 Average Daily Trading Volume 10,000 est.
|
Company Description:
Brighton Technologies Corp. “Brighton” is a technology systems integration company with operations in the Greater China market. The company operates two main subsidiaries BIC and BECL. The BECL subsidiary is an investment and holding company that is involved in all aspects of computer and industrial equipment, and wireless telecommunications. BIC is a distributor of third party manufactured industrial equipment primarily to customers in China and other Pacific Basin countries.
Securities Trading Automated Quotation System (STAQ):
The Beijing Brighton-STAQ Electronic System (“Brighton-STAQ”) is a Peoples Republic of China joint venture that was formed to design, develop, install and maintain a computer network for the trading of securities in China (the “STAQ On-line Network”). The Company owns a 90% interest in the Brighton-STAQ. During February 1998, the Company commenced initial operations of the STAQ On-line Network for the STAQ Exchange. The Brighton-STAQ, which is modeled after NASDAQ presently has 550 member firms located in 65 cities throughout China. The excess capacity on this state of the art system can generate additional profits by processing other applications such as hotel reservations, credit card clearing, and any other transaction where information exchange and confirmation is required. The remaining 10% interest in Brighton-STAQ is owned by a company controlled by the STAQ Exchange, one of four national securities exchanges in China.
Internet Possibilities:
There other additional applications for this network. This network is designed for the computers to communicate with each other in order to conduct stock trading and other secure transactions required in the development of e-commerce. It is our belief that this network could handle significant internet traffic. If this is the case, Brighton Technologies could also develop as a large Internet Service Provider ‘ISP’ in China. We will be watching the company very closely for further developments in this area. If the company does develop the STAQ On-Line Network into a significant internet presence then we would expect the shares to appreciate significantly from current price targets.
Equipment Installation:
The Company’s focus in the computer network integration segment of its business is in wireless telecommunication systems. Computer network integration revenues include revenues from the sale and installation of the Aria Wireless System. This encompasses other equipment exported to the Pacific Rim region by the company.
Equipment Exporting:
The company exports equipment from the United States to China and other Pacific Basin countries and has approximately 130 representatives and new factories currently being built. Brighton has demonstrated the ability to locate everything from machining equipment to computers which they utilize in new factories. The company has successfully exported communications equipment from Cisco Systems, and Sun MicroSystems. It is expected that this portion of the company’s business will continue to grow at a rate of 10-20% annually and it has proven to be a consistently profitable.
Our Analysis:
The financial crisis in South East Asia started in the fall of 1997. Previously, the South East Asian region of the world was regarded as one the fastest growing economies in the world. In the 18 months since, governments of the various countries have began to implement the economic reforms that are needed for economies to return to prosperity. The Chinese economy has been spared from the economic problems that the rest of the nations in that portion of the world have endured. This is partially due to the fact that the Chinese currency is not readily convertible into the other currencies of the world. During this period, the Chinese government has steadfastly maintained that it will not devalue its currency. This has created a feeling of confidence in the Chinese economy and allowed China to be viewed as a favorable market.
The economies of the various countries that make up this region of the world are in various stages of turning around and resuming positive economic growth. As this occurs, the companies that have penetrated and developed markets should see very positive growth. Brighton Technologies is positioning itself to be one of these companies.
The shares of Brighton Technologies are currently trading on the Over the Counter Bulletin Board System under the symbol ‘BGHT’. The management of the company believes the company will be able to qualify for a listing on the NASDAQ Small Cap. Automated Quotation System by the end of 1999.
The STAQ On-line Network has very large potential. Recent rule changes in the United States have allowed for the development of “Electronic Communications Networks” (ECN) to allow for the direct trading of stocks on the NASDAQ stock market. These ECN’s compete directly with brokerage firms in the trading of company shares on the NASDAQ. While the oldest of the ECN’s have only been around for a few years, they have already become very popular and account for a significant portion of the average daily trading volume. Several of the larger Wall Street firms have recently began to create their own ECN’s to compete. New rules changes by the Securities Exchange Commission (SEC) are paving the way for ECN’s to function as separate stock exchanges. While none of them have actually began to do so yet, it is not difficult to see that the groundwork is being laid for their eventual competition with the New York Stock Exchange. This is important to the future of Brighton Technologies Corp. as the evolutionary changes currently taking place in the US stock markets provide guidance as to the possible development of the Chinese and other Asian equity markets. Brighton Technologies Corp. is the majority owner of the STAQ On-line Network which will connect key Chinese securities exchanges. The STAQ On-Line Network has established links among brokerages in Beijing, Shanghai, Chongqing and Shenzhen. As the Chinese economy continues to grow and their economy becomes more open it is our belief that the Chinese will need even greater amounts of capital that will require an active and healthy stock market to provide investors with liquidity. As with all developing markets, those who acquire market share first generally tend to be the most profitable. It is our opinion that the STAQ On-Line Network will be a major player in the Chinese stock markets.
Our Recommendation:
Sterling Investment Services, Inc. is recommending the purchase of shares in Brighton Technologies Corp. (OTC Bulletin Board ‘BGHT’) at their current price levels. We believe these shares offer excellent upside potential.
Notice of custom research
Sterling Investment Services, Inc. is an independent investment management and research firm. Sterling Investment Services publishes four different newsletters, three of which are broadcast on a nightly basis. Sterling Investment Services, Inc. received compensation for the production of this report. Additional information on these newsletters can be obtained from our web site at ‘www.sterlinginvestments.com’. Sterling Investment Services, Inc. was paid a consulting fee in conjunction with the production of this report.
The Sterling Investment Series of newsletters is produced by Sterling Investment Services, Inc. If you would like to receive a chart on any index or stock mentioned in this report please contact us at the below mentioned numbers. We also offer custom research reports on any stock investment that you may desire information on. To receive further information on these services please visit our web page at: www.sterlinginvestments.com If you would like to contact us our # is 800-275-6901, fax # (404)-816-8830 Email address is: enelson@sterlinginvestments.com Sterling Investment Services may hold positions in the securities recommended or may be providing consulting services to the companies mentioned within this report.
Order an Investor Kit
| FREE Subscription to the Small Cap Advisory Letter | FREE 1 week trial subscription to our Fax Service. |
| FREE 30 day trial subscription to our Email Service | Subscribe to the Newsletter over the Web |
PO Box 191767, Atlanta, GA. 31119-1767
Fax 404-816-8830
404-816-8240
Home