RE: [Misinformed] Facts on IOM and SYQT!
techstocks.com
You have to be about the most misinformed person I've ever met...
IOM:
...have the market share! (All ready built into the stock price)
Yes, Iomega has the market share. It stole it away from SyQuest. But if you're assuming that "the market" is a fixed sized, you've got another thing coming. It is projected that the removable storage market will expand to 25 million units (annually) by 2000. That's a lot of growth in a little time.
In what ways will SyQuest get the market back? Are they reaching the OEM market? Iomega Zip is standard in well over 100 SKU's from dozens of OEM's. Is SyQuest in even one?
It's very hard to steal the market away from an aggressive leader. Just ask Cyrix or AMD. Or anyone who has ever competed with Microsoft.
...produced low end products! (Evaluate yourself or ask people who left IOM)
It's called a mass market. It wasn't until Iomega introduced the Zip that removable storage even started to become mainstream.
...IOM is confused about SYQT products! (Wining Award form major PC ...magazines)
Iomega has received awards, too. It's not awards that make a company money. It's sales.
...IOM will not comeback if they loose the suit! (it's there last chance)
Come back from what? I think you forget which company is the underdog here.
The suit isn't about chance or defending market share. It's about protection of intellectual property, plain and simple. Iomega spent over $90 million on R&D last year. They protected their research with patents. SyQuest stole Iomega's ideas. Big mistake.
It's SyQuest who doesn't have a chance if they loose this lawsuit.
SYQT:
...let IOM beat them to the puch(They learned their lesson)
Did they? They're still focusing on the high-end of the market, which has always been a pretty small, niche area.
...have good product! (Read their patent)
That's fine, but it takes a lot more than a good product to make a good company or stock. How about marketing? How about profitability? How about name recognition? How about a stable balance sheet?
...got supports from financial community (Got cash to build up inventory to meet demand)
No, they got cash from venture capitalists and their vendors to pay for operating losses. As a result, they diluted their stock about 10X! That's not a great way to get future support from the financial community....
...got supports from IOM (IOM Marketting CEO, IOM's Engineers and a free advitisement from the suit. I wonder if they bought some call option on SYQT before they annouce the free advertisement)
Yes, they were able to hire away a few people who were passed over for promotions at IOM. And yes, they may get a little publicity in the investment community from the lawsuit. But how will that help sales?
Bottom line:
Would buy stock of a company (IOM) that is TRYING to hold market shares + stock price; Or a company (SYQT) that has a far more supperior products and is winning market share (and stock price is it's dirt cheap).
Dirt cheap stock price, huh? We can't really compare P/E's since it's been 2 years since SyQuest has had a profitable quarter. Let's look at the Price/Sales ratios instead:
IOM: $3000 / $1468 = 2.0
SYQT: $360 / $139 = 2.6
Which one's overpriced, now? The one that's making profit consistantly, continuing to increase market share, growing at break-neck speed, expanding into other markets, and is price at only 2 times sales? Or the one that's facing extinction, losing money at break-neck speed, losing market share, diluting their stock, and is priced at 2.6 times sales?
You're certainly entitled to your opinion, but please don't try to represent it as fact.
- Michael Coley
- i1.net |
