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Our New Surprise Pick:  Ovation Music & Studios, Inc.  (OTCQB:  OVMS)

After another big run for our system, we are looking to really press the pedal to the metal today with a new pick that encapsulates everything we look for in a micro-cap breakout candidate.

OVMS is in the music business.

The company offers private one-on-one music lessons, including private one-on-one instructions for piano, voice, guitar, bass guitar, drums, sax, flute, clarinet, ukulele, mandolin, banjo, and other instruments for children and adults.

They also have repair and rental services, set up bands and performances, do camps for kids. Basically, if it has to do with music, OVMS does it.

The company is making money, too, with Q3 gross profits showing a huge 14% growth y/y. This is no fluke. This is solid business. America has a growing obsession with music. Everyone wants to the next American Idol. The US music market is already worth over $15B in sales, and growing fast.

OVMS had occasion recently to announce that it’s beginning a new marketing campaign around its hub locations designed to attract music education students young and old. This increased exposure moves the needle for us.

The company’s marketing plan includes TV ads in target markets on specific networks as a means of hooking in a key demographic that includes beginning musicians in a school age audience of 8-15, as well as more advanced players in the 16 and up age range as well as more seasoned players to play in the advanced Rock Shop™ and Jazz Jam™ ensembles. All Ovation students and musicians are able to take part in the Rock Shop™ and Jazz Jam™ programs.

We also love to see recently announced plans for expansion of the company’s footprint in both its South Florida and Nashville, TN, hub locations either through licensing its business or acquiring existing music education and music stores (See Full Press Release Here).
 
All of this strikes the chord of a company beginning to tune up for a major advance. And with a float of just 10M shares, a major run higher would take very little new interest. This is a squeeze waiting to happen.

The recent check of support at the $0.01 level was successful on strong volume, and the stock has flowered 75% higher in response. This feels like a sturdy level to check and bounce, and may well line the stock up for some big upside opportunity from here.

About OVMS

OVMS (Ovation Music & Studios, Inc.) As of February 11, 2015, Perfect Web Technologies was acquired by Perfect Web Technologies primarily provides private music lessons in the Palm Beach and Broward county areas of Florida.

OVMS offers private one-on-one music lessons, including private one-on-one instructions for piano, voice, guitar, bass guitar, drums, sax, flute, clarinet, ukulele, mandolin, banjo, and other instruments for children and adults.

OVMS is also involved in the rental, repair, and sale of musical instruments, such as acoustic and electric guitars, bass guitars, ukuleles, drum sets, P.A. sound equipment, woodwinds, brass, violins, and other instruments. In addition, the company engages in the rental and sale of school band instruments comprising flute, clarinet, trumpet, trombone, alto saxophone, tenor saxophone, French horn, baritone, oboe, violin, and percussion kits of various brands, which primarily include the Yamaha, Buffett, Jupiter, Gemeinhardt, Selmer, Mapex, Vito, Bach, King, Conn, Holton, Besson, Armstrong, and Cooper brands. Further, it provides Rock Shop program for children and adults; summer camps for kids; and rehearsal studios for bands and individuals. Additionally, the company offers business cards, posters, postcards, vinyl banners, signs, T-shirts, P.O.P. displays, custom drum heads, direct CD printing, CD jewel cases, trade show displays, car wraps, vinyl lettering, and other products graphic designing servicers for bands or businesses.

Top Investor Highlights

• OVMS has a small trading float of just 10M shares, which suggests the stock could launch higher on any additional influx of interest.

• OVMS is making real money, with gross profits growing at over 14%.

• OVMS just checked penny support on huge volume, and then pivoted higher, setting a strong level in place as support.

• OVMS is coming off an RSI trough under 40, pointing to a massively oversold stock now heading back the other way. 

OVMS Begins Expansion with Nashville Area Location

Ovation Music & Studios, Inc. (OTC: OVMS) (the "Company"), signed a lease in June and in September started construction to open a new location in Gallatin, Tennessee, just outside of Nashville.

Nashville is the "home of country music", and is a major music recording and production center. The music industries' major recording labels, including Universal Music Group, Capital Records, Sony Music Entertainment, Warner Music Group, EMI Group, as well as numerous independent labels, have recording studios and offices in Nashville.

The Company has begun the build out of the location, and has hired Elijah Ellis to manage the location.  Elijah Ellis is a well known Nashville musician, formally a touring blues musician, and vintage instrument collector and trader.

The Company initially plans to build location territories around the South Florida and Nashville, Tennessee markets.

Keith De Tone, the Company's CEO & Chairman stated, "This is the first step in establishing the Ovation footprint in the Nashville market. We cannot be more excited about Ovation being part of the Nashville music scene and a music educator in this market."

Nashville's Music Row is home to hundreds of businesses related to the country music, gospel music, rock and roll, jazz as well as contemporary Christian music industries. Music Row is the heart of Nashville's entertainment industry.

Numerous record labels, publishing houses, music licensing firms, video production houses, along with other business who serve the music industry, as well as radio networks, radio stations and recording studios. Some of the top recording studios include, Blackbird Studio, Sound Kitchen Studios, House of Blues Studios, Quad Studios and Sound Stage Studios.

"We have a personal and educational relationship with The Blackbird Academy - Professional School of Audio,as one of our team is a recent graduate as a sound engineer, " Keith De Tone, CEO. The Blackbird Academy is affiliated with Blackbird Studio.

Nashville's Music Row area has been home to the headquarters of guitar company Gibson since 1984. Since the 1960s, Nashville has been the second-largest music production center (after New York) in the U.S.

A comprehensive study of Nashville's music and entertainment industry shows it has a $10 billion annual economic impact on the Nashville region.  The Nashville area has more music industry jobs than any other U.S. city in relation to population and total employment, even more than New York or Los Angeles. The music industry helps create and sustain more than 56,000 jobs in the Nashville area, supporting more than $3.2 billion of labor income annually.

In Summary

OVMS is at the heart of the music industry. Profits are growing, the float is small, and the chart is signaling a key low is now in place. Don’t overcomplicate life.

Company Website:  http://www.ovationmusicstudios.com

Quote:  http://finance.yahoo.com/q?s=OVMS

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