A couple of comments on the timing of the announcements:
Two things to remember with regards to the underwriters and the secondary:
1. H&Q and JP Morgan have to keep iomega happy by selling the secondary at
a reasonably high price.
2. H&Q and JP Morgan have to keep their institutional buyers happy by
selling at a price that will ensure
that they make a profit. After all there will be more secondaries and IPOs
that they have to sell to these
same people.
So, the Packard Bell and Acer deals are announced before the secondary is
complete. Now, we know that the underwriters do not want to jack up the
price, sell the secondary, and leave their other customers (the
institutions) out to dry. The conclusion, these announcements would not have
been made before the secondary is complete, if there were not more
announcements coming after it's over. More OEM and/or product announcements
are coming.
As supporting info we see:
1. the strong IBM and Apple rumors.
2. OEM evaluation time period that KE mentioned, falls in June
3. The two June computer shows. Historically, iomega has used
these shows to announce products and relationships.
Is ioimega overpriced? The way I see it, every new OEM
1. cements future profits
2. locks out competitors
3. Increases the certainty with which we can estimate future
earnings growth. The more certain we are oftheir earnings, the
more the stock is worth. Risk is removed with each new OEM
deal announced.
When we double again from here, remember your favorite charities (as MF Chiros periodically reminds us).
Do, I believe this? Yes, I bought back the covered calls I had sold
on a portion of my shares.
Other items: JP Morgan 96 Revenues Estimate, 1.2B for 1996.
I have seen estimates that I believe for 1996 at 1.5 to 1.9 billion and 3 to 3.8 billion for 1997. Looking at this we see a fair value at the end of 96, at 100+ per share.
I logged a few interesting posts on this, if anyone is interested just e-mail me and I'll forward them to you.
Ken |
