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This Month's Tiny Gems - May 2009Local.com (NASDAQ: LOCM)
Macquarie Infrastructure Company LLC (NYSE: MIC)
Uranium Energy Corp (NYSE AMEX: UEC)
Local.com (NASDAQ: LOCM)
Local.com (NASDAQ: LOCM) is recognized as the largest local search network in the United States. The company provides more than 19 million consumers each month with the most relevant search results for local businesses, products and services on Local.com and 700+ regional media sites. According to Internet research firm comScore, Local.com’s traffic has consistently ranked in the Top 100 U.S. websites.
Recently, the company announced that it has acquired about 14,000 local business advertisers from LiveDeal, Inc. for up to $3.1 million in cash. This acquisition brought Local.com’s total number of small business customers to approximately 30,000, more than half way to its stated goal of 50,000 by the end of this year. Excluding one-time acquisition related charges, the transaction is expected to be immediately accretive and yield a significant margin contribution.
Despite the downturn in the economy, Local.com reported 78% growth in revenue for full year 2008 when compared to the revenue generated in 2007. The company’s growth strategy for the future includes growing the volume of visitors to Local.com via search engine marketing, search engine optimization, syndication and repeat usage. Local.com also intends to continue developing new products for advertisers and enhance its many local search technologies.
The total volume of online advertising in the United States is expected to grow at a compound annual growth rate of 18 percent to approximately $26 billion in 2010. This growth rate should accelerate even further as many large businesses begin expanding their marketing budget to include online advertising to reach today's computer-capable audiences. With local search advertising growth anticipated to outperform other forms of online advertising, Local.com is well positioned to capitalize on this rapid growth.
Macquarie Infrastructure Company LLC (NYSE: MIC)
Macquarie Infrastructure Company LLC (NYSE: MIC) is focused on owning, operating and investing in a diversified group of infrastructure businesses in the United States. These businesses include an airport services business, 50% of the company that owns one of the largest bulk liquid storage terminal businesses in the US, a gas production and distribution business, a district energy business and an airport parking business.
Airport services comprised the majority of the company’s gross profit in 2008. The division consists of 72 fixed base operations (FBOs) on leased land at 68 airports throughout the United States and one heliport in New York City. Services include terminal operations, refueling, de-icing, aircraft parking and hangarage. Macquarie Infrastructure believes the quality of its operations and strong marketing programs provide a competitive advantage in the marketplace.
Because of their nature, Macquarie Infrastructure’s businesses are apt to generate a stable, increasing amount of revenue over time. Currently a substantial portion of that cash is being used to reduce debt owed by Macquarie Infrastructure and its operating companies. Once debt levels have been reduced and the debt markets are functioning properly, the cash flow will once again be used to distribute cash dividends to shareholders.
Recently appointed CEO James Hooke has a range of investment, restructuring, business improvement and asset management experience across the North American infrastructure and private equity sectors. His track record of establishing and growing businesses in management, board director and corporate development roles makes him the perfect candidate to lead Macquarie Infrastructure’s next phase of development as the company strives to restore shareholder value by reducing debt levels, effectively managing expenses and improving operations.
Uranium Energy Corp (NYSE AMEX: UEC)
Uranium Energy Corp (NYSE AMEX: UEC) is a US-based junior resource uranium mining company focused on becoming a near-term ISR uranium producer in the United States. The company controls one of the largest historical uranium mining exploration and development databases in the US, which it has used to acquire advanced uranium properties throughout the southwestern US.
Uranium Energy has focused its property acquisition program primarily in the states of Texas, Wyoming, New Mexico, Arizona, Colorado and Utah. This region has been recognized as the most concentrated area for uranium mining in the US. The company’s strategy of acquiring exploration databases and leveraging those databases to generate acquisition targets has been successful thus far.
Uranium is primarily used as an energy source for nuclear fission reactors. Nuclear energy is a safe, highly efficient, and emission-free alternative to fossil fuels. In view of current annual reactor demand and current annual mine production, it has been estimated that there will be a supply shortfall of 80 million pounds per year for several years. With at least 140 new nuclear reactors now planned to be built over the next 10 years, this demand will only increase.
With the public increasingly realizing that nuclear power plants generate electricity with far less greenhouse emission than fossil fuels, Uranium Energy Corp. sees themselves in a favorable position for funding and exploring all aspects of uranium development. They continue to explore for uranium opportunities to fuel their company’s growth and are well positioned to capitalize on the imminent explosion of demand for uranium.