I live in the city of Iomega (Roy, Utah). I drive by their new buildings every day. Less than 4 years ago the stock was $1 (more like .20 post splits). I saw the new construction for offices and work space. I watched the stock go to $150 pre-split, but I kept thinking they had topped as the stock kept rising.
Now I see new construction and new hiring. I'm in for the ride! How can anyone read the 6 or so press releases out just today and not see the new IBM monster size company being born? In IBM's day it was the computer itself. Today it's all the peripheral requirements, storage solutions, portability, WebTV type applications, Music purchases over the internet, pictures and streaming video over the internet and applications to get the pictures in and out of computers. Today more than ever I've seen the future and the future is Iomega! Clik! will bring rejuvenation to sales, the new, 250 (higher margin) drive will increase earnings, the internet over TV, music disks and other new applications will quickly bring Iomega to the status of Microsoft.
We're lucky that it takes longer for good news to move a stock with this many shares in either direction. That gave us a little more time to get on board. My bet is that by the end of November, institutional buyers will come back. They were down to 8% of shares. The low price and the need for window dressing drove them out recently. Their exit resulted in ridiculously low prices, above and beyond what was called for due to lower earnings. Advertising on the Super Bowl and elsewhere - something like $100 million worth - was an ill advised expense that made earnings look bad. Now that's history, and so is SyQuest. Just watch the institutional investors pour back in. As they do, slowly at first to not attract attention, prices will gradually rise. But like the frog in the pan of water, those who wait too long won't see it coming until the stock is already HOT!
Well, that's my story and I'm sticking to it.
Long and Happy!
David |
