Maybe I'd buy your sales figures for Q4, but look too fast for Q3. Do you
know what the distribution of units was for WP7 over the quartes after
it started shipping? Cowpland said that unit sales of WP8 were 30% ahead
of WP7 over a similar period. Did WP7 unit sales grow quarte to quarter,
or was there a "filling the pipeline effect" which caused bigger initial
numbers? If you used a 30% increase over WP7 units over a similar period,
I would buy that.
As for net income, I bet that the more Gross Profit, the more Advertising
and the more Research and Development. They have Corel Computer Corp. to
fund, along with all the Java development. After watching closely for a
couple of months, and after falling flat on my face with predicting EPS,
I suspect that Cowpland is fully committed to breaking MSFT's grip on
this market, and he's not going to leave any spare cash around, even for
a quarter. If Corel wasn't into the new hardware venture, and betting the
farm on Java, they would probably be highly profitable. But it seems that
that's not the goal. "First Call" is predicting .03cents EPS for Q3. I would
have thought that way too low, until I saw what happend in Q2.
The good news is that Compaq Computer was once in the same situation competing
with IBM. Compaq was spending every cent to break thru IBM's monopoly.
Their stock was selling for less than liquidatioin value. They (with Apple) succeeded.
At the low point in 1984, if you bought $14,000 in stock, by 1994, you'd have
over $1 million. (This info from "HOW TO BUY TECH STOCKS" by Michael Bianturco.)
I would say that's pretty much Corel's financial strategy. They don't just
want to make money, they want to win big.
I am very encouraged that the stock is continuing to climb since
the disappointing EPS on Monday eve. Maybe investor's are seeing beyond
the numbers, and realizing that Corel is probably the most exciting company
in this entire area.
Regards
irv. |
