Nevin S.- As we were discussing on AFCI thread, here's a blurb out of CNET that IMVHO, is on target(except for the figures?).
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On May 3, Harmonic closed a deal to acquire DiviCom, the digital video equipment division of C-Cube Microsystems, a transaction then valued at $1.7 billion. Soon afterward, the stock took a hit over concerns about the fiscal health of the newly acquired division. The stock has fallen 68 percent this month.
"Their DiviCom business was completely in the toilet this quarter," said UBS Warburg analyst Anton Wahlman, who previously expected the company to post $108 million in revenue and earn 31 cents per share.
On a pro forma basis, Wahlman said DiviCom earned $39.4 million in the first quarter, and he expects the unit to make $14 million this quarter.
"They overpaid for the DiviCom business and guided people too high on their revenue expectations," Wahlman said. "Maybe previous (DiviCom) management sold them on these (expectations), maybe Harmonic did not do their due diligence, maybe it was a combination of many factors. I don't know."
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IMHO, it's not HLIT that causes me a great deal of concern, but it's still Divicom. I'm not quite sure where the reporter got his figures, but the gist of his comments are on target. I think there must be some communication problem between the reporter and analyst on the numbers. -MikeM(From Florida) |
