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Technology Stocks : copper mountain CMTN
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To: aldim who wrote (1103)10/18/2000 12:28:28 AM
From: P314159d  Read Replies (1) of 1226
 
Your analysis is too simplistic, by just using the earnings / sales %

I can enlighten you some from my own S/S analysis of this company.

The GPM is based on two factors: parts cost and Factory overhead (basic fixed cost). Just using experience I break out 7% of COGS for the basic fixed cost data. For CMTN last report that is ~6.5m and leaves a parts costs of 40% for next qtr analysis.

The Operating Expenses have been growing each qtr. Even if CMTN shuts that down, this qtr the OpEx was 25.5m.

Next qtr would look like 60m revs. with 24m Parts costs and 6.5m fixed cost and leave a GPM of 29.5m. Subtract Opex at 25.5 and add in Interest Earned of 2.5m and you have 6m Earnings before tax.

Use same tax rate and 58m shares and arrive at 6.5 cents EPS.
Do the same for next year and expect some margin erosion and some increase in OpEx. 0.25 estimates are pretty accurate.
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