Company guidance is always conservative at the beginning of the year and once again this year they 'are comfortable' with 23% earnings growth guidance. If my memory serves me, last year they were 'comfortable' with 20-25% earnings growth guidance and actually showed over 35% from the previous year. At 23% eps growth, the low end of the stock price range should be somewhere around $29/share (a little less than 20% downside). If they come in around 35% actual growth in eps this year(similar to last years growth) and are 'allowed' by the market to have a 35PE, the stock should trade in the high 40s (about 35% higher).....just playing with the numbers......
Here's today's news:
American Power Conversion Expands Network and Desktop Presence with Acquisition of ABL Electronics
WEST KINGSTON, R.I., May 1 /PRNewswire/ -- American Power Conversion (Nasdaq: APCC) announced today that it has acquired privately held ABL Electronics Corporation, a North American provider of computer and network cables, switches and other connectivity products, for $8 million paid in a combination of cash and stock. ABL provides an expansive complementary product offering, enabling APC to leverage its global scale, strong channel presence, OEM partnerships, and Web site traffic to deepen APC's penetration into network and desktop environments worldwide.
"With our established world-wide channel presence, resale agreements with leading PC, server and networking manufacturers, and approximately one million monthly Web site visitors, APC has the necessary fundamentals to successfully position ABL as a global leader in the cable and switch marketplace," said Rodger B. Dowdell, Jr., APC's president and CEO. "This transaction is consistent with APC's strategy to identify complementary and incremental businesses that capitalize on our global leadership and diversified sales model."
ABL, which currently sells through distribution, value added resellers and OEM partners, offers a broad selection of both standard and custom network and desktop cables and connectivity products. ABL's products range from universal serial bus-ready (USB) solutions for the small office/home office market to fiber optic, Category 5 and fibre channel cables commonly utilized in Internet, telecommunication, and storage area network (SAN) infrastructures to server management switches used to manage multiple servers from a single monitor.
"We are pleased to join the APC team, a recognized leader that has the resources and track record to take ABL to the next level," said Randy Amon, co-founder of ABL. "Given the cultural similarities of the two organizations, we believe this new combined team will start delivering synergistic value immediately."
"By expanding our power protection solution offering to include ABL's complementary cabling and switching products, we also obtain additional leverage with our channel and retail partners, who prefer to do business with a limited number of manufacturers," said Dowdell. "In addition, this transaction allows us to expand our relationship with our 10 million existing customers worldwide who value the quality, reliable solutions APC offers, as well as realize cost efficiencies in the acquisition of potential new customers."
Consistent with historical trends, the Company expects the core APC business to exhibit mid-to-high teen sequential growth from the first to second quarter. The acquisition of ABL, coupled with the acquisition of Advance Power, will add approximately $12 to $14 million in incremental revenues to the Company's second quarter. This transaction is expected to be neutral to earnings per share in the year 2000 and is expected to be accretive thereafter.
ABL, which employs 80 people in the U.S., is based in Hunt Valley, Maryland and has satellite offices in Texas, California and Illinois. ABL will become part of APC's Consumer Network Solutions Group.
Safe Harbor Provision
Statements contained in this press release which are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties which could cause actual results to differ from those projected. The factors that could cause actual results to differ materially include the following: APC's ability to successfully integrate ABL and Advance Power's operations; the timely development and acceptance of new products; ramp up, expansion and rationalization of global manufacturing capacity; general worldwide economic conditions; growth rates in the power protection industry and related industries, including but not limited to the PC, server, networking, telecommunications and enterprise hardware industries; competitive factors and pricing pressures; changes in product mix; changes in the seasonality of demand patterns; inventory risks due to shifts in market demand; the effects of any other possible acquisitions; component constraints and shortages; risk of nonpayment of accounts receivable; the uncertainty of the litigation process including risk of an unexpected, unfavorable result of current or future litigation; and the risks described from time to time in the Company's filings with the Securities and Exchange Commission.
About American Power Conversion
Founded in 1981, American Power Conversion (Nasdaq: APCC), a Fortune 1000 company, is a leading provider of global, end-to-end power protection products and services, which include surge suppressors, uninterruptible power supplies (UPS), power conditioning equipment, related software, and professional and consulting services for Nonstop Networking(TM).
APC's comprehensive solutions, which are designed for both home and corporate environments, improve the manageability, availability and performance of sensitive electronic, network, communications and industrial equipment of all sizes. APC, which is headquartered in West Kingston, Rhode Island, reported sales of $1.337 billion for the year ended December 31, 1999. All trademarks are the property of their owners. Additional information about APC and its global end-to-end solutions can be found by accessing the APC World Wide Web site at www.apcc.com or by calling 800-877-4080.
For more information contact:
Media:
Jodi Kennedy, director of media relations, 401-789-5735, ext. 2158,
jkennedy@apcc.com
Investors:
Donald M. Muir, chief financial officer, 401-789-5735, ext. 2105
Deborah K. Grey, investor relations manager, 401-789-5735, ext. 2994,
dgrey@apcc.com
SOURCE American Power Conversion
CO: American Power Conversion; ABL Electronics Corporation
ST: Rhode Island, Maryland
IN: CPR FIN
SU: TNM PDT
05/01/2000 14:53 EDT prnewswire.com |
