Traders and Investors,

Here is a small cap tech company that we've previously profiled and it needs your attention immediately.

The Company is Surge Holdings (SURG).

We introduced you to SURG in late November and December last year, just a few months ago, when it was trading between $0.35-0.40. 

In early January, just a few weeks later, SURG broke out to over $0.65 gaining between 67-91% from the price when we profiled it.

The catalyst for such a major move? All the foundation work is done. SURG's sole priority now is roll-out and revenue growth.

And there have been many new investors focused on SURG recently as a result of big news from the Company, and exposure from independent analysts and commentators from major websites such as Seeking Alpha.

This Seeking Alpha commentator, who identifies SURG as a "virtually undiscovered company with high growth potential”, estimates the share price of SURG could be $11 by 2021. 

That's 2,400% higher in the next two years.

You can read this commentator's analysis on, and opinion of, SURG at https://seekingalpha.com/article/4238650-surge-holdings-unknown-story-high-potential-growth ... Make sure you do, it is a fascinating read.

And in early January, SURG announced the first free wireless service not subsidized by the government.

The SurgePhone Wireless free unlimited plan is available online and will be the flagship product rolled out to a network of approx. 40,000 retail stores throughout the United States. Customers can purchase a SurgePhone Google Certified Android Smartphone for under $100 or simply get a Free SIM starter kit and use with their own unlocked GSM device. Surge anticipates ad revenue of $10 generated from each user service plan, where the more the phone is used the greater the revenue generated. The SurgePhone also becomes the hub for customers to receive the full suite of Surge FinTech products and services.

You can read more press releases at https://finance.yahoo.com/quote/SURG?p=SURG&.tsrc=fin-srch

As you can see on the chart below, SURG has pulled back from its recent spike, and traders may be looking to "buy the dip".

We think there could be an excellent chance that SURG makes another run higher in the coming days / weeks.



And a recent shareholder's update from the Company points to huge revenue numbers. 

According to the update, revenue totaled $7,485,485 in the six months ended June 30, 2018.

That's huge!!!

And according to CEO, Brian Cox, in the same Shareholder update, SURG has been built for speed and to scale rapidly so that they can move swiftly toward their 2019 EOY target of 15,000 locations.

This could mean $22.5 million in revenue per month according to this Goldman Small Cap Research Report!!!
 

Surge Holdings Inc (OTCQB: SURG) is a Telecom and Fintech Software company intending to become the country’s leading provider of technology products to the unbanked, under-banked and the overlooked by selling through its SurgePays network of convenient stores and through online digital marketing. 

Surge has holdings in Telecom, Blockchain Fintech and Digital Marketing.

Led by a 16 year telecom veteran and CEO Brian Cox, the management team has been assembled specifically for the Surge journey and committed to exponential growth utilizing experience, existing systems and cross trained human capital.  This venture is planked by the specific and strategic goal of uplisting to Nasdaq.

The Seeking Alpha analysis identifies Surge Holdings' target market as a group that is largely ignored and under-served, including:

• The bottom one-third of income earners in the USA
• Individuals who are unbanked or under-served
• 51% of the population with invisible or sub-prime credit
• 77 million cellphone users without a contract
• Any price-conscious consumer
• Under-privileged teenagers with limited access to the Internet
• 71% of people (in this study) who shop 5 times or more a week at local corner stores

In addition, the report identified three key products and services offered by SURG. These include...

SurgePhone Wireless offers free (and subsidized) wireless smartphone plans in the US

SurgePhone offers discounted talk, text, and 4G LTE data wireless plans at prices that average 15% – 40% lower than competitors. (Unlimited plans start at just $10/mo) Available nationwide, SurgePhone also offers strategic discounts such as the Surge Heroes campaign that rewards teachers, first responders, active military and veterans with a free Android smartphone (surgeheroes.com).

Here's an extract from the aforementioned Seeking Alpha article...

Is this a profitable venture? Let’s look at one hypothetical scenario.

• Charities give out 1 million donated used smartphones to underprivileged teenagers and families across America
• These phones are pre-loaded with a ‘forever free’ monthly smartphone plan
• According to this Surge news release, $10 in revenue is generated off every subscriber
• Assume a gross margin of 35–40% or $3.50-$4.00 in gross profit per sub every month
• $42-$48 million in gross profit per year

The gross profit potential on just 1 million customers is ever greater than that. The Mulaah app continues to drive ads and revenue via the unlimited texting plan even after the 1 GB is used up.

SurgeVolt 5XL Android Smartphone

The Surge Volt 5XL’s  is a Google Certified Android manufactured specifically for providing the lower income market with a low cost android with a large 5” screen and powerful 8Gig Quad Core processor. The Volt 5XL is the perfect vehicle to bring customers into the Surge ecosystem and become the hub for customers to receive the full suite of Surge FinTech products and services. Also, by controlling the software on the handsets, Surge is able to preload and market related Surge products and services for significant additional revenue streams while at the same time monetizing and rewarding the activity of Surge customers (Surge Rewards Program) to further encourage longer term, more loyal and profitable customer relationships.


SurgePays Visa – A pre-paid Visa card

Another life-enhancing product for the un-banked or under-banked is the SurgePays Visa card. This is an $11 billion industry.

SurgePays Reloadable Visa will be launched in early 2019. This card will perform the functions of a traditional credit card and also a checking account for the unbanked or credit challenged. The card will be distributed through the SurgePays network by having cards hanging on J-hooks (similar to gift cards). The customer will take the card to the counter and load cash on the card through SurgePays 2.0. The customer will then have the option to go online and fill out their information so they receive a card with their name on it. This personalized SurgePays Visa card will offer safety, security and convenience of using the card anywhere that accepts Visa and empower many customers to enter the digital age. 

Customers will be able to access their accounts from the connected app to remit money to friends and relatives while avoiding costly fees. In addition, customers will also be able to take a picture of their paycheck and load the cash to their cards (eliminating costly check cashing fees). There are a number of revenue streams built into the SurgePays Visa including interchange portions of the merchant transaction fees, nominal monthly fees, ATM withdrawal fees, convenience fees and interest from monies on deposit.

You can read more about all of SURG's products and services on their website https://surgeholdings.com/products/

Conclusion

Surge Holdings is a virtually undiscovered company with high growth potential. They have designed a distribution portal that will hopefully be deployed across the US in a potential 40,000+ stores by the end of 2019. Their products serve the ignored, under-privileged and credit challenged. The SurgePays Portal will be the technological backbone allowing corner markets to order traditional and fin-tech products while letting store owners share in the revenue and save time.

Three interesting products that are poised for big growth are the following:

• A low-cost Android phone
• Free monthly no-contract, no-credit cellphone plan (and paid ones)
• Re-loadable Visa that acts more like a bank account

The phone and the cellular plans are available now while the re-loadable Visa is due out the 1^st quarter of 2019.

According to this Seeking Alpha article, the share price could reach $11 in 24 months assuming no dilution and if the products sell even modestly well. The upside is much greater than that if the products are really embraced. In a scenario of very high growth, I would imagine a buyout would be the most logical way to absorb the network and existing customer base instead of trying to compete.

We think there could be a good opportunity here in SURG, especially with its price just above $0.40. In fact, SURG recently hit a six month high back in January this year of over $0.65.

A bounce higher from this pullback could bring more upside for traders.

So, get SURG on your radar and be ready for the opening bell.


All the best.

SmallCapMomo.com

Remember our key trading rules when trading. Capital preservation is key. Keep your stops tight, and if things don't go your way, cut your losses and look for another opportunity.