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Msg  11 of 12  at  3/11/2009 12:50:12 PM  by

thevoiceatvoicedup.com


Buy

COGENT to U.S., thank you stimulus package

Cogent (COGT) can be identified as a government contractor. For this reason COGT should benefit from the stimulus bill that the Obama presidency recently passed as spending on new programs will continue to grow. COGT is in the business of providing an automated fingerprint identification system (AFIS) and biometric solutions to organizations such as law enforcement agencies, commercial organizations and governments throughout the global market. Current commercial partnerships include fortune 500 companies such as IBM, Oracle, Hewlett Packard and most recently Northrop Grumman (see partnerships). Law enforcement agencies working in tandem with Cogent are located in the Americas, Europe, Asia and Africa. This list continues to grow yearly as they become recognized as the fastest and most accurate biometric identification system available. Their success is transparent on the company's balance sheet as they have approximately $500M of cash in their coffers and $0 debt. This accounts for $5.00/share of their current price of 10.00, this is a very sufficient cash cushion should there be a prolonged downturn in the current economy. The company has numerous outstanding contracts from awards that could drive the price of the stock up substantially once deferred payments are realized. The timeline of these payments is the current concern hence the price being stuck around the $10.00 a share range. As demands increase from governments around the world to improve efficiency with one another there will be an increasing number of projects for Cogent to win. Aside from oversees opportunities our own homeland security issues will provide additional revenue generating possibilities as can been see by the below pipeline:

2009 Pipeline (Source JP Morgan)
Project - FBI Next-Generation Identification
Contract Value - $200-$400m
Description - Upgrade of the FBI’s IAFIS system. Lockheed Martin was chosen as the prime contractor for the program in February 2008. An RFI for the fingerprint portion was issued in August 2008. COGT has been down-selected (along with 5-6 other companies). The RFP is expected to be issued in late November with a response due date in December. The contract award for the criminal history and terrorist files of the database is expected in late 1Q09 (March). Revenue is expected to begin in late 2009, with orders ramping in 2010.

UK Identity Scheme
$200-$400m
Program involves biometric visas, enhanced passports and identity cards for people living or working in the UK. CSC, EDS, Fujitsu, IBM, and Thales were selected as prime contractors in May 2008. The five suppliers will compete in “minicompetitions” to win specific contracts for the various projects of the Identity Scheme. COGT is on both the IBM and Thales teams, though it is unclear whether or not it is the exclusive biometrics provider to either. A benchmark providing details of the fingerprint portion of the Scheme is expected soon, with an award likely in 2009. Revenue is expected to begin in late 2009, ramping in 2010.

UK Post Office
TBD
UK Post Offices will install enrollment stations at each post office site in order to issue passports/driver’s licenses/ID cards under the UK Identity Scheme. COGT is one of two suppliers that have been down-selected for the contract.

BOSS-R
$100m Similar to the BOSS-U program except that the BOSS-R program is restricted to small businesses only (i.e., Lockheed Martin, Northrop, etc., are not allowed to participate). COGT is bidding as a subcontractor for the program. Algeria UK Project Midas $56m-€40m COGT is one of two suppliers bidding for the program. An award is expected imminently. UK law enforcement procurement for handheld biometric devices to perform mobile identification checks. The project is likely to be multisourced, with orders beginning in 2H09 and ramping in 2010. Completion is targeted for 2013. COGT has been down-selected for the project. Go to Cogent

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