3 stocks to own that have the potential to appreciate 300-1000%

S.A. Advisory E-Mail Update

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3 stocks to own that have the potential to appreciate 300-1000%

Quadlogic, Inc (QDLC-.52)www.quadlogic.com The ultimate sleeper stock that is about to wake up with gigantic gains.





May 05, 2017


Luvu Brands, Inc. ( LUVU .055)www.luvubrands.com Healthy sex products and casual seating and comfort products. Run rate of $20 million and profits. Enhance your sexual experience and make $ at the same time.

Vicon Industries, inc. ( VII .41) www.vicon-security.com Trading near 52 lows but new products being rolled out offer a ground floor investment opportunity!

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Bonus warrant play that offers huge upside with 4 1/2 year left before expires. See brief on OPXXW. www.optexsys.com

Quadlogic Controls Corp ( QDLC)

Quadlogic is the only automatic meter reading (AMR) provider in the US that develops, manufactures and sells digital electric interval "smart" meters and metering systems with an integrated power lines and lies at the core of the Quadlogic suite of metering technology. The Quadlogic metering system allows commercial and residential building owners and tenants to measure and reduce energy usage which in turn helps the environment by reducing greenhouse emissions.

Please spend some time and visit their website and review the many world class buildings that QDLC has metered within Canada,United States and Mexico.

During past few years the company had not been reporting financial results and was considered "dark"!

That has all changed during the past few weeks and reported all back year end results and the most current 9 months. The year end results for Feb 28, 2017 will be reported to the financial community and shareholders by the middle of June 2017. The company has every intention to continue reporting quarterly results going forward.

In our opinion, the reason for the spotlights to shine bright and advertise the company as being a public entity is because QDLC has recently been awarded very valuable & profitable contracts from foreign entities during the current & future years . QDLC will be receiving a very attractive royalty payment for use of their technology, software, hardware and proprietary manufacturing for their metering products.

It is important to review their financial results for 2014-2016 and their 9 months ending 11/30/2016.

Also please review the Master license Agreement dated 2/23/2017 and released 4/21/2017.

THE DEVIL IS IN THE DETAILS!

During fiscal years 2014-2016 ending Feb 28th or Feb 29th it is apparent that revenue for QDLC during those 3 years were flat-line (around $12 million/yr and small losses from continued operations). The R & D continued at a very brisk pace of $1.2 million/yr. An impressive amount of money spent for a micro-cap.

Now the fun part of the story! During fiscal 2017 ending Feb 28, 2017 QDLC was awarded from a Mexican entity a $2.8 million royalty for the use of their technology and production of products used and installed in Mexico. Upon review of the 9 months ending Nov 30th 2016 the company had received $950k and the balance of $1.9 was received during the 4th Q of fiscal 2017 ending Feb 28th 2017. It is very important to understand that this royalty is treated as revenue, but most will just fall to the bottom-line and cause earnings to explode for the fiscal year just ended. The numbers have not been reported, but we are making some very logical assumptions that are easy to prove.

Before this royalty arrangement happened the company was doing around $12 million/yr. Just look at the past 3 years below. The total revenue of $12 million + $2.8 million equals $15 million for fiscal 2017 to be reported June of 2017. The final payment of $1.9 million received in our opinion will mostly fall right to bottom-line and create a huge profit. All companies have a point within their revenue/margin cycle that creates the perfect "storm" for explosive earning and the fourth Q of fiscal 2017 will do this for QDLC. We believe that of the $1.9 million received at least $1.5 million will results in earnings + the $200k for the 9 months equals $1.7 million. Based upon the 11.3 million shares fully diluted and outstanding result in .15/sh

During fiscal 2018 March 1st 2017 QDLC received another royalty agreement totaling $6.74 million (according to management this agreement will be completed during the 2nd and 3rd quarter of fiscal 2018. This huge royalty payment will catapult revenues to around $20 million and our calculations of at least $3.5 million net or .31 (Not sure how much NOL is available in order to reduce State and Federal Tax, when you earn money taxes must be paid. Now if Trump is able to get some tax relief for corporations then the picture gets much brighter and our profit meter jumps. )

We believe fiscal 17 and 18 could be even more profitable than our calculations. It should be noted QDLC is currently bidding on a few huge contracts due to be awarded during early 2018 which if awarded will take place during fiscal 2019 ( we hear around $8 million- could be smaller or larger. Please keep in mind that QDLC's track record bodes well for additional contracts.

Consider that from fiscal 2016 thru 2018 that revenues will explode from $12 to $20 million and earning go from a loss of .04 to a pot of gold of at least .31!

Since QDLC trades on the "pinks" and not fully reporting at present we must give PE multiple a haircut . Growth is 80% until the end of fiscal 18 from fiscal 16. We believe that a conservative PE of 15 should be assigned to QDLC. Based upon fiscal result of .15 and using a PE of 15X we get a current share price of $2.25. Based upon fiscal results for 2018 of .31/sh and using a PE of 15X we get a 6-12 month target of $4.65.

At present QDLC is trading @ a PSR of .39 we believe that 1.5X would be a fair valuation & would result in a share price of $2.00 based upon fiscal 17 revenues of $15 million and based upon fiscal 18 with estimated revenues of $20 million and PSR of 1.5X would result in a $2.75 share price.

Anyway you slice or dice this stock the current valuations are extremely undervalued and very attractive with little to no downside risk and spectacular upside during the next 12 months.

STATEMENT OF OPERATIONS

FISCAL YEARS ENDING:

2014A--015A---016A---2016/9A---017E---018E

$11.7m--$12.1m--$13m--$10m----$15m--$20m-

($147k)- $185k)-($456k)- $199k-$1.7m-$3.5m-

----------------------------------.02A---$.15E--$.31E-

Based upon 11,300,000 fully diluted shares outstanding

Overview:

It is only a matter of time before the herd "bids" QDLC to much higher levels than the current .52 pricing. Management decided to report again because they know that the company's share price deserves to be much higher than recent levels. A major growth mode has been entered and in this case the early bird gets the cheap stock. It is possible within the next 12 months this stock could rocket 800% from current levels based upon conservative valuations. We rate QDLC with a strong buy recommendation at current levels for extraordinary gains.

Luvu Brands, Inc. ( LUVU .055)- fully reporting with SEC and current on all reporting

The company owns, promotes, markets, and licenses a portfolio of consumer brands in the wellness industry, including sexual health, casual seating, comfort products, and lifestyle categories. The Company is located in Atlanta, Georgia. Their facility is 140k feet of vertically integrated manufacturing and employs over 150 people.

The Company's brand sites include: www.liberator.com www.jaxxliving.com www.avanacomfort.com plus, other global e-commerce sites. You can also visit their corporate site, namely, www.luvubrands.com

Please take some time and review a corporate presentation just released on April 26, 2017. The whole story about the growing success of this micro-cap jumps off the pages. A discount value investor will buy this .05 stock in a heart beat. We assume that will happen even before he or she checks out the adult pleasure products as well as their trendy casual seating offerings.

https://www.sec.gov/Archives/edgar/data/1374567/000101738617000066/exhibit_99-1.pdf

Select Financial Data: Year end June 30th

-2015A-2016A-2017E--6 months 2017A-2018E

rev 15.5m-16.8m-$20m---$9.2m -------$23m

income(.007)-(.004)-.02 ----.003---------.035

Based upon 72 million shares fully diluted

Shareholders equity - negative $2 million

NOL- over $8 million

Note: The 2nd & 3rd Q historically are the strongest because of Xmas and Valentine's Day. During the 2nd Q of the current fiscal year LUVU earned .01/ diluted share. The 3rd Q results are due within the next couple of weeks. We estimate that the company will earn at least .01 for that reporting Q.

Upon review of the current financial data as well as their current overview produced by the company and released on April 26th it is easy to conclude that LUVU is entering a more rapid growth rate. The numerous graphs and charts demonstrate the direction of LUVU short and long term.

First we would like to thank management for creating 150+ jobs in the USA. Management could have produced their products overseas at much lower costs.

The current run rate for LUVU for fiscal 2017 ending June 30th will be about $20 million in sales and earnings/sh of around .02! Management talks about faster growth because of new products, cost reduction and additional channels that are increasing sales.

At present LUVU only sports a PSR (shares outstanding of around 72 million, rev est. of $20 million for current year ending June 30th 2017 and share price of .055) of only .2! The current share price would have to be .27 in order to calculate a PSR value of 1! A value of 1 is considered extremely cheap and undervalued. LUVU would have to appreciate 400% to achieve this value of 1 based upon current completed and estimated results for the balance of this fiscal year.

By comparing the last couple of years & fiscal 18, it is easy to conclude that LUVU will grow by 20% over last year. Fiscal 2018 growth could match or exceed this ramp up. If we assign a conservative PE estimate of 13X for earning estimates for the fiscal 17 of .02 and fiscal 18 of .03 we can assign a valuation of .27 and .39 respectively. Again, a far cry from the current share price of .055.

We actually see zero risk on the downside at current levels & only "blue sky" short & long term on the upside. We have continued sales growth Q after Q and new products coming on line that will continue to grow sales. The management team continues to expand the reach of all products via e-commerce.

Bottom-line: LUVU is fundamentally very cheap and offers investor a short and long term growth platform for huge capital gains. We also appreciate the Buy American and Hire American mantra.

Vicon Industries, inc. ( VII .41)

The Company designs, assembles and markets video management system and system component for the use in security, surveillance, safety and communications applications by a broad group of end users. The Company's product line consists of various elements of a video system, including DVR's, NVR's, video encoders, decoders, servers and related video management software, data storage units, analog, digital and HD megapixel fixed and robotic cameras, virtual and analog matrix video switchers and controls and system peripherals.

The Company sells video surveillance system components in a highly competitive worldwide marketplace principally to authorized security distributors, dealers and system integrators .

During the past number of years the company has incurred losses and lower revenue, but continues to fund at a robust level a completely new, and strategically critical, video management system. The first release of this product offering was launched in January 2017 and is ULTIMATELY EXPECTED TO SIGNIFICANTLY ENHANCE THE COMPANY'S MARKET COMPETITIVENESS . The funding of this major development effort has contributed to the ongoing operating losses and depletion of cash reserves.

SELECT FINANCIAL DATA:

Sept 30th year end result

2015 ------2016----first Q fiscal 17 vs first Q 16

rev $44.9m--$35.7m--- $6.6m---------$10.9m

loss(.57)----($1.37)------ (.14)------------(.10)

cash $2.8 million or .30/sh

NOL-$28 million or $3/sh

Book value .79

Just released brochure

http://cdn.vicon-security.com/wp-content/uploads/2017-PSG-Guide_EN-1.6.17.pdf

NEW CREDIT FACILITY-VERY BULLISH

https://ih.advfn.com/p.php?pid=nmona&article=74393713

Increased ownership to 10%

https://ih.advfn.com/p.php?pid=nmona&article=74467236

OVERVIEW:

It is not unusual for a company that is transitioning from an old product line to a new improved mix of products to see sales of the old line shrink & revenue drops until the new line is active and ready for marketing. It is not unusual for buyers to hold off until the new products are ready for sales and installation !

VII's legacy products are fading away and new cutting edge security products are coming on stream. The company has just secured a new line of credit. The lender would not play with VII if they thought that company was going to fail. A new 10% owner just surfaced- that investor may very well have a better understanding than the regular investor type. As they say "follow the money"! The cash per share is .30 and the book value is .79 a far from the current share price of .41. The share price is near its 52 week low and the current state of depression for its shares approaches how the Dems feel about Trump as President!

The company also has a juicy $3/sh NOL- this makes for an attractive acquisition bait on a hook!

Bottom-line: VII trades for around 3/4 cash value, 1/2 book value, trading near 52 week low, a huge NOL worth $28 million or $3/sh , a market cap of less than $4 million, new enhanced credit line and new products being introduced ( see product guide).

The portrait of a successful turn-around is ready to emerge and could easily cause the shares of VII to appreciate sharply during the next 12 months. We rate VII with a strong Buy recommendation & we could easily reach our target price of $2.00 within 12 months.

Stock Performance during past 12 months

SYMBOL***REC PRICE***5/05/17**STATUS

OPXS------------.70------------.78-------strong B

OPXXW--------.15------------ .21--------strong B

VUZI------------$6.35------$5.85---------strong B

ESMC---------- .10-----------.17----------BUY

STRI-----------.26-------------.21---------strong B

AETI-----------$1.60---------$1.85------strong B

WPCS-------$1.25----------$1.30-------strong B

MKRYF-------.10------------.09-----------HOLD

BSGM---------$1.33--------$1.45--------strong B

SIMA---------$2.50---------$5.05--------BUY-------

ASNB------------.07---------.05-------------HOLD---

HEMA-----------.35-------$2.80----------strong B

Since Trump was elected the DOW has climbed around 3000 points and the other indexes have followed suit. His conversation to lower corporate tax rates, lower capital gains, possibly tax foreign goods and reduce regulations would help our workers, companies & our Country.

Wall Street has rallied because we would remove the chains controlling Corporate America and rebuild our Country. The low price stock arena has not been as rewarding as the more mature companies that are listed on the various exchanged in the USA.

The reason for this that there are less people investing, ETF investing and the high capital gains rate. Maybe President Trump can find common ground with the DEMS and create a better atmosphere for business in America. A better business climate with less regulation, less taxation and better worldwide opportunity for our products surely will start to filter down into the micro-caps sooner than later.

Optex System Holdings, Inc (OPXS-.78~~OPXXW .21)

www.optexsys.com

Prior recommendation: Great Military play and extremely undervalued.

On May 1st 2017 Management announced the purchase of 700k shares from a private source. This reduces the shares outstanding to only 7.5 million. The purchase price was .74/sh or $518k. At present the book value is around 1.00/sh . The second Q is due in two weeks time. We believe that revenue will reach around $20 million and earning will be .20-.25 for the current fiscal year. Backlog should continue to grow rapidly as the United States Military rebuilds in every aspect of military readiness. The company manufactures optical sighting systems and assemblies, primarily for DOD applications. Its products are installed on various types of U.S. military land vehicles, such as Abrams and Bradley fighting vehicles , light Armored Security Vehicles, and have been selected for installation on the Stryker family of vehicles . Optex also manufactures and delivers numerous periscope configurations, rifle and surveillance sights, and night vision optical assemblies. Optex delivers its products both directly to the military services and to prime contractors.

During the next 4 years the Trump Administration has promised to rebuild our military might and OPXS will surely benefit dramatically. Either delivering products to our forces or many Allies.

We foresee rapid appreciate of OPXS during the next 4 years and believe that the warrants OPXXW offer investor's the smallest investing principle with the largest appreciation potential. The warrants are non-callable and exercised @ $1.50. (expire 2021)

. Here is the math: Buy 10k shares (OPXS) @.77 or $7700 or buy 37,000 (OPXXW) warrants @ .21 or $7770.00

Let us say that the common is worth $4.00 in 3 years.

The common would be worth $40,000.00 resulting from a $7700.00 investment and long term profit of $32,300.00. (party time)

The warrants would be worth at least $2.50(in the money) and most likely would retain a premium of .50 because there is so much time left. If the total warrant price is $3.00/warrant. We have 37,000 (OPXXW) X $3.00/wt or grand total of $111,000.00. We subtract the $7770.00 from the $111,000.00 and we are left with $103,230.00 profit!! (Now that is party!)

Owning both the common and warrants are a smart move and we will surely profit, but the warrants are like a bottle of Macallan 25 Scotch on the seat of a "new" 911 S Carrera.

STRONG BUY RECOMMENDATION ON THE OPXXW

WE MAY BUY, SELL AND OR HOLD AT OUR OWN DISCRETION .We own shares in bsgm.

Some material was derived from Goldman Small Cap & SeethruEquity. Some medical data retrieved from various news sources.

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