Hi Doc,
Andy's advice is right on! However, info, opinions, data, etc., from anywhere you can get it should be used in making those decisions.
I've been investing for 36 years and Cube is, IMHO, one of the most promising that I've been able to get into fairly early (i.e., they have a mere 36M shares outstanding). Those who bought Microsoft (they have >1 billion share outstanding) in 1986 and held-on are very rich now! Maybe Cube will not be another Microsoft or Intel, but it could be. I like Cube for the following reasons:
1. Dr. Alex Balkanski - three degrees from Harvard plus he's only 36 years old and appears to be very smart, energetic and ambitious.
2. An excellent mgmt team consisting of young men (<42 years old)who appear to be experts in their respective positions.
3. What appears to be a well thought-out mgmt plan which they adhere to without regard to what pundants are saying about them.
4. Proven products recognized and adopted by established leaders in the video industry. Did you know Cube received an Emmy award?
5. Their acquisition of DiviCom.
6. Their IR&D percent of revenue (see recent financial reports). They know that new and improved products must be developed to sustain their leadership position.
7. Their selected markets in consumer electronics, communications and computers (see their Form 10K for year ended 12/31/96). By the way if you haven't read their Form 10K, do so, it contains a lot of good info about the company.
8. Their penetration of the Chinese markets. Not easily accomplished nor recognized by a lot of US companies.
9. Dr. B's emulation of both Microsoft and Intel (e.g., the branding program). However, Cube is "fabless" which I see as an improvement to both Microsoft's and Intel's approach. Cube also buys future access to fabrication of their chips to guarantee production when they will need it. Essential to "ramp-up" their products quickly.
10. Their recognition that the emerging countries crave video/audio delivered entertainment to Americanize their quality of life.
11. Their extremely low outstanding debt burden, their performance to date, etc., etc., etc.
12. There are several other reasons too numerous to mention, but you get the general idea.
NOTE: All the above comments are solely my personal opinion derived from my own research analysis and is in no way intended to be a reflection of Cube or its management.
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