Clearly, Dale Pfau has a difficult job in the near term. Valence's assumption and control of the Bellcore patents really rocks the boat. In short, how does he quantify or value the new business plan? It's no longer possible to quantify the companies near or long term progress solely by assuming a progressive bean, uh battery count. This is reduced in the near term by the delay in delivering the new high speed assembly machine. Bean projections go down over the near term but the value imputed by license fees and later, royalties is intangible before the fact. Licensing takes on a whole new dimension. This throws out the JV scenario but opens up a broader realm, quite a bit larger potentially. How does one quantify or value the potential new categories such as military, governmental applications that we've seen recently? What projections can be made in light of the probable demand for powders and films not to mention the licensing of same? This was assumed(by me) to be moderate to low until the recent news. Matsushita, whom has complained about profit margins with their "potato chip" psuedo polymers is attempting to transition to large batteries. How will their plans be affected by the prospect of European and Malaysian licensees getting into this market? Will they feel pressure to negotiate a license? Too much for me to figure out, for sure.
I think Lev's current deemphasis on in house manufacturing is a bit of spin due to the embarrassment of the Q numbers and the delay in delivery of the new assembly machine. What would you want to talk about, the latest numbers or the new grand scheme which potentially could register "7" on the Richter scale? The Valence factory is very, very close to ironing out the remaining, mass process glitches in production. IMO, the tone will change in coming months to reflect a more even balance between in house production and licensing and the tone will be justifiably upbeat. Meanwhile, analysts and investors wait, watch and try to imagine. |
