If I may, I believe that Stockman Scott's earlier post has the flavor that the technology that we've all invested in so heavily via AWRE and other DSL broadband companies is already obsolete, and so what we should really do is migrate (with our investment funds) into the Fiber sector, where the real "dominant" architectural groundwork is being laid. Let me make five (small) observations:
(1) It would probably serve us all well to put some money into Fiber, which is a sector with mind boggling potential. I don't think there's anything wrong with that vision at all. However......
(2) P314159d's point (if I may) is that (a) the demand for broadband data transmission/capability is incredible right now, and (b) the technology with the greatest potential for delivering that promise, right now, is the combination DSL-phone lines and cable. The demand for high-speed internet access is rabid NOW, and that's exactly why Aware's technology is NOT obsolete.
(3) I have been through the "competing technologies" discussion before, with respect to Cymer's niche as the prime laser manufacturer for DUV (deep ultraviolet) photolithography chip etching technology versus competing technologies (principally copper) and watching that debate tends to move me in the direction of believing that the scientific community tends to coax as much improvements as possible out of the existing technology, simply because of lower ramp up costs to generate improvements in bottom line profitability. This usually gives an existing technology the advantage over a hot looking competitor technology.
(4) One should be careful about the manic moods of the market. One day it's B-to-B firms. The next it's any firm connected to Fiber. Tomorrow? The fact that the market currently loves this sector or that sector says nothing more to me that that a big chunk of money is speculating with the profitability of this or that sector. Wireless is also getting a big push right now. Who's to say that in a year (on a new 5-10 year time horizon) wireless technology won't leave fiber in the dust. Never lose sight of the fact that all your really looking at with stock price valuations is the market's current and momentary vision of a future economy that doesn't even exist yet.
(5) As a final kicker, I would say that there is a lot of concern about "insane valuations," and a lot of examples right now where individuals hold up beaten-down DOW stocks and say stuff like, "here is a perfectly good company with substantial earnings that's selling for 4 times those earnings, and here's a tech stock selling for 300 times earnings - it's just ridiculous." My point is, that if there is a correction involving high-flying tech stocks:
(a) all tech stocks will correct to some degree, but i feel that the ones that will really get kicked in the teeth are the ones selling for fantastic multiples on earnings that are years away, and
(b) a lot of the money going into techs from here out will probably seek tech stocks with (i) proven technology AND (ii) a verifiable cash flow stream visible now. I tend to think that this makes AWRE a more sensible tech stock to the somewhat more cautious tech investor.
One thing I did notice, in watching a bit of television last night is that there are an incredible number of advertisements for tech and internet growth funds. I hope that some of the money flowing into these funds finds its way to Aware. jess. |
