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Technology Stocks : Meade Instruments Corp MEAD
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To: Gary105 who wrote (81)3/27/2000 1:36:00 PM
From: moat  Read Replies (2) of 175
 
<<Message #81 from Gary J. Goetz at Mar 26 2000 9:25AM
Order of magnitude calculation of impact:
Assume 100 M people work in cities
Assume ultimate terabeam penetration is 25M (25%)
Assume average size of organization is 250 people
Therefore number of window units = 25M/250 = 100,000
Each unit costs $150, assume mead's share is $40 (ie about 1/4)
Then total potential mead sales = $40 x 100,000 = $4M
Assume this is spread out over a few years and results in incremental sales of $1M/year
Be liberal and assign a PSR of 10 to this. Therefore incremental increase in shareholder value should be $10M or $1.25/share.
The above is an order of magnitude (ie most likely good within a factor of 10) estimate.
All imo,
Gary>>

Good thinking Gary. Couple other datapoints: 1) Meade's lenses are likely to be in the hubs, 2) We don't know the cost of the lenses in the hubs, and 3) There are a total of 700,000 office buildings in the U.S.

Also, TeraBeam said anticipated monthly revenues per customer are $6,300/month. The number of businesses needing this type of service (gigabit speed) is not a huge number.

Nonetheless, your way of thinking (analysis) is an excellent way of getting our hands around the overall size of the opportunity to Meade.
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