I think it depends on what the operating cash flow for this business will be once they cut back staff and stabilize. Do you have any guesses on that? The operating cash showed a huge loss for 1Q2009 so right now it is a falling knife.

Even if they could sustain $12M free cash flow for 2009 (they can't) and even if the share price were at $1.50, that would give an implied return against enterprise value of about 25%. It's good at that price, not great.

Having said that, I don't think they can do $12M in free cash flow. If someone has an idea of what kind of cash flow they can generate I would love to hear.