More projections from January FBCS analyst:
But analysts are more intrigued by news that Kopin will double its capacity by adding eight more HBT production systems this year, which should significantly boost earnings and revenue next year. Between the start of last year and this March, the company will have quadrupled its capacity to meet demand for its HBT wafers, says Joel Pitt, at Credit Suisse First Boston. Kopin's main customer is Conexant Systems (CNXT), which announced plans to triple production of HBT-based integrated circuits this year and has contracts with Ericsson (ERICY). Mitsubishi Electronics has already placed orders with Kopin, and Pitt figures Nortel (NT) and other circuit makers could become customers.
Kopin doesn't have much competition. RF Micro Devices (RFMD), the only other significant producer of HBT wafers, "can't even supply enough to meet its own needs," Pitt says. Anadigics (ANAD) and Alpha Industries (AHAA) have announced plans to get into the business, but Motey says that demand for the wafers will probably continue to outstrip supply for the next year or longer.
Kopin's additional capacity prompted both Pitt and Motey to hike their earnings and revenue estimates for this year. Pitt now expects Kopin to earn 47 cents a share, up from his previous forecast of 40 cents a share and a big jump from the estimates of zero earnings for 1999. He expects revenue to jump 123% this year to $83 million and rise next year to $154 million. And those estimates could be "conservative," Pitt says.
Still, the stock could give back some ? if not all ? of that huge gain in the next few days. "We think the company has a really great story," says Pitt. "But the current stock price may very well reflect unrealistic expectations."
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