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Technology Stocks : DWCH-Datawatch Worth Watching!
DWCH 13.100.0%Dec 13 4:00 PM EST

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To: Mike 2.0 who wrote (174)4/30/1997 3:34:00 AM
From: Paul Viapiano   of 462
 
OK, after some number crunching, here is what I've come up with...

Trailing 12m sales $32,141
Trailing EPS $.18

Based on $1.75 closing price:
Price/book 1.7
Price/sales .5
PE 9.7

Gross margins 82.2% same as last qrtr
Net profit margin 1% down from 5.1%
ROE 16.1% down from 20.4%
Current Ratio 2.0 up from 1.7
Quick Ratio 1.9 up from 1.6
DSO 98 down from 107
Accts Rec Turn .9 same
Inv Turn 1.9 slightly up
SGA% of Sales 72.6% up from 69.5%
ROA 8.5% down from 11.1%
Debt to Equity 17.4% up from 2.3%

I don't like the debt level climbing drastically here but maybe this is temporary. The extra 240K in expenses is what prevented DWCH from making 4 cents this quarter. Couple this with the flat (actually slightly lower) sequential sales adds up to a big, unshiny "penny for your thoughts"! Inventories and receivables seem under control...the only question remaining is "Do they have it in them to light a fire under their butts?" The conference call will be interesting...please, please post all info possible from the call. I want to know if they are candid in the face of this stumble or do they have their phasers set on spin? Even the best of companies sometimes have terrible quarters...can DWCH recover from this and how long will it take? Foley said in the last call that the market needed to catch up to DWCH...well it has! Flat year to year growth is usually awarded a PE of 7-9. Foley should be careful what he wishes...

Paul
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