ORLANDO, Fla., Nov. 1, 2007 (PRIME NEWSWIRE) -- RedChip Visibility, a division of RedChip Companies, Inc., announced that it has initiated research coverage on Onstream Media Corp. (Nasdaq:ONSM), a leading online Application Service Provider of live and on-demand, rich media communications via the Onstream Digital Media Services Platform (DMSP).
ONSM recently completed the latest set of feature enhancements to its proprietary webcasting platform, including a webinar service providing the means to hold a virtual seminar online in real time, and several additional upgrades, including a Flash-based player, embedded Flash video and both audio and video editing capabilities. Some of the new upgrades to the company's Visual Webcaster platform will allow for high-definition cameras and other HD sources to input via serial digital interfaces to allow for a broadcast-quality experience. Onstream is also anticipating the release of its iEncode platform later this year. This platform will allow for an almost unlimited number of viewers to view Onstream audio and video presentations.
RedChip Research Analyst Piyali Chakravarty, M.B.A., wrote in the initial report:
"ONSM has a current price/sales multiple of about 5, and we are estimating revenue of $16.8 million for the full FY08. In ONSM's August 2007 10Q filing, the ending number of shares disclosed by the company was approximately 42 million. We use this number to represent shares outstanding for FY08, which is subject to possible other conversion of warrants and convertible securities. Thus, we are expecting the company to generate revenues of $0.40 on a per share basis in FY08. The company's revenues are growing faster than 50 percent of its peer group. We believe it would be quite realistic to assign a P/S multiple of 8, which is only slightly higher than the average multiple for the peer group and represents a 33 percent increase from current multiple levels for ONSM.
"The P/S multiple of 8 that we are assigning to ONSM is 64% less than that of ONT, which has a similar pattern of revenue growth rate as ONSM. Therefore, by multiplying the full year FY08 revenue per share estimate of $0.40 by a P/S multiple of 8, we arrived at our target price of $3.20, which represents substantial appreciation from current levels."
To receive a complimentary copy of the RedChip Visibility Initial Research Report for ONSM, please visit:
http://www.redchip.com/visibility/about.asp?page=requestONSM_initial
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DISCLOSURES
The analysts contributing to this report do not hold any shares of ONSM. Additionally, the analysts contributing to this report certify that the views expressed herein accurately reflect the analysts' personal views as to the subject securities and issuers. RedChip certifies that no part of the analysts' compensation was, is, or will be, directly or indirectly, related to the specific recommendation or views expressed by the analyst in the report. Additional information on the securities mentioned in this report is available upon request. This report is based on data obtained from sources we believe to be reliable, but is not guaranteed as to accuracy and does not purport to be complete. As such, the report should not be construed as advice designed to meet the particular investment needs of any investor. Any opinions expressed herein are subject to change. ONSM is a client of RedChip Visibility, a division of RedChip Companies. ONSM paid RedChip Visibility in services equivalent to $36,000 for the RedChip Visibility Research Program, which includes this report. RedChip Visibility has been contracted by ONSM to increase investor awareness of ONSM to the small-cap equity community. These services may include investor conferences and digital and print distribution of ONSM investor related materials.