If you take a look at USRX annual reports I think you'd agree that they have great management.
They have consistently increased their revenues per employee. This is one indicator of solid management.
The company is very nimble in taking advantage of market conditions, and they are innovative. For example, their new "Pilot" may not make a dent in their revenue stream just yet, but many people agree that the Pilot represents a new era in palm-top computing.
In 1991, Cisco was not the only player ... Wellfleet was right behind them, and there were dozens of other companies trying to get a share: Proteon, Network Systems, IBM... But Cisco proved that they had the superior product and became the clear leader in the field. Now with over 80% of the Internet being routed by Cisco equipment they are a very solid company (trading at double the P/E of USRX, I might add).
USRX is in a similar situation. They are clearly the market leader in remote access products. The only thing that scares me a little is that Cisco has their sights set on USRX ... in buying part of Telebit and making deals with Microcom they clearly have their eyes on the lucrative remote access market. But the fact remains that USRX is in most of the ISPs, has a *huge* deal with AT&T for WorldNet, and has a jump on the competition. They are not dependent on Joe User buying a Sportster for continued earnings growth.
They will certainly not grow at 130% year anymore, but I think we can count on USRX to sustain consistent growth of at least 50% a year for the next few years, which is still fantastic.
The current price is a bargain. A P/E of 26 is way too low for a fast grower like USRX. Get in while you can! |
