Ludlow Capital Issues USA Technologies (USAT) $2.00 to $2.50 Target

(NEW YORK)--Ludlow Capital, and New York based equity research firm, issued an upgrade to USA Technologies (NASD: USAT), a developer of cashless payment vending machine technology, with a near-term target of $2.00 to $2.50 per share.

The growth in customers, and cashless transactions may now be positioning USAT on what the company itself calls a 'tipping point' in regards to the growth and use of their ePort Connect Service. For the quarter ending September 30, 2010, the Company reported that it had processed a record 14 million in transactions for a total of $24.5 million for their customers, which represents an increase in transactions of 89% over the same period 2009.

In addition, the Company reported 1,200 customers now connected to its ePort Connect Service, up from 1050 on June 30, 2010, or around a 12% to 15% increase from just a few months ago.

As more and more people become comfortable with using cashless means to pay for such products as vending machines products, the company should see continued sharp growth going into the 2011. The use of credit and debt cards for payments from younger demographics is only growing, such as in college dorms or military barricks. The ability to purchase snacks and other products through cashless means has very strong growth potential, which should allow USAT to gain more of that market share well into 2012.

The company projects being EBITA positive by end of quarter Dec 31, 2010, which will mark a major milestone for the USA Technologies. The Company has very little long-term debt ($730k), with around $7 million in cash in the bank as of the end of the June 2010 quarter.

The Company is expected to release their earnings for the quarter ending Sept 30, 2010 on or before Nov. 12th, which in our opinion could see the stock already trading in the $2.00 to $2.50 price range.

In addition to the common shares, which trade under the symbol USAT on the NASDAQ, the company also has preferred shares which trade under the symbol USATP, and warrants with a strike price of $1.13 which trade under the symbol USATZ.

Ludlow Capital began coverage on USAT on October 7, 2010 at a price of $1.10 per share.

http://www.wallstreetnewscast.com/news/2010/october/usat.html