Peter,
Good questions, all of them. Allen is no doubt in a better position to answer them, but I'll take a stab.
1) As you know, the overall royalty forecast is an aggregate of WIND's various lily ponds. It therefore does not follow any type of fitted growth curve, but relies on individual projections for each market's growth. When reasonable predictions or extrapolations cannot be generated (such is the case in out-year estimates for a few of the lilies), conservative numbers are used.
2) The current incarnation of the model as posted to the site represents more of a "what if" type scenario demonstrating WIND's stock value than anything meant to predict exact EPS. However, we will continue to work to develop a complete model encompassing all aspects of the company, including services revenue and margins, R&D spending, interest income, investment income, taxes, etc. With this completed, it will be possible to validate the model in subsequent quarters.
3) no macro-economic issues are being modeled. Rather, one could adjust the unit growth of each lily pond to reflect such concerns.
Hope this helps (and is reasonably accurate),
Brian |
