I've been watching Videoserver for a while now and wondered if anybody
shares my interest in the company. Videoserver is not in the list of
companies covered by Silicon Investor, so here is some background info.
Videoserver make multipoint videoconferencing equipment.
'Videoconferencing' systems as they are termed are for the most part
used for communications between two parties (like you use the phone).
Videoserver make the multipoint control units (MCUs) required to have
more than two parties connected in a true videoconference. H320
videophones/cards as sold by PictureTel, Vtel, Intel etc. dial into
the MCU and each site can view up to four others. At present the
company's products are being OEMed by Picturetel and Compression
Labs, and are also being bought by carrier companies such as
Southwestern Bell. I suspect that most of the carriers are playing
with these products at present to decide whether they wish to launch
dial in videoconferencing services in an analagous way to the dial in
telephone conference call services provided today. Geographically
distributed companies could use these services to hold regular video
meetings where they previously could not justify the cost of flying
people (I don't believe this technology will ever replace face to
face meetings). Companies could also buy a product from Videoserver
to serve their own internal needs (Videoserver is also establishing a
VAR channel). Conferences need not be restricted to video, but
through the T.120 standard parties could also exhange data too
(eg. People in multiple locations watching a presentation, reviewing
a sales figures spreadsheet etc.)
The company beat analysts expectations of its 1995 earnings by 10 per
cent this week, and these estimates were increased during the year
anyhow. Here are the last 8 quarters results:-
Revenue Earnings EPS
$K $K $
Q1 94 3223 124 0.01
Q2 94 3715 178 0.02
Q3 94 4170 309 0.03
Q4 94 4487 461 0.04
Q1 95 5512 594 0.06
Q2 95 6810 985 0.08
Q3 95 7311 1300 0.10
Q4 95 8654 1808 0.14
Gross Margin 64-65 percent. Videoserver went public in May and has
been rather volatile since (what hasn't). It has been falling lately
- current price is approx $27.
Am I a wild optimist, or is this a very interesting company?
I think it should be added to the list of companies covered by this site.
Gavin Warnes |
