Ron,
Thanks for the info. regarding the web sides.
As for the Dec. Q result, I like their revenue growth. Considering that NTAI and VTech talked about component shortage about three months ago, DSWL's sale growth is quite impressive.
The major reason for the earning disappointment is the fall in gross margin. When compared with the previous quarter, it dropped by more than 5%. It could be due to pricing pressure, or due to rise in the raw materials. If it is the former, I think that DSWL can get the gross margin up by improving the productivity, if it gets higher sale. If it is due to the later, stock piling raw materials helps. In addition, OPEC has agreed to increase production, and the pressure on the raw materials should be easing in a matter of three-four months.
I am not very concerned about the higher cost due to R&D. I view that expense as investment.
Although the earning is disappointing, I am holding my shares due to two reasons: 1) YOY comparisons for the next few quarters should be quite strong. 2) DSWL is still one of the few great values I can find. [Ref. Most large ECM companies have 20% in gross margin and are selling at 2X sale. DSWL has more than 35% in gross margin, and is selling at 1X sale.]
I look forward reading what you hear from Mr. Lau.
Steven
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