TROY GROUP(Nasdaq TROY)-Paying E-Commerce by Check Message Board

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Technology Stocks : TROY GROUP(Nasdaq TROY)-Paying E-Commerce by Check

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To: PAL who started this subject	4/12/2001 9:07:46 AM
From: Blue Voodoo	of 31

TROY Group earnings out. A short sober analysis: Revenues down 7% from year earlier (excluding non-recurring licensing sale). This would indicate that TROY's legacy businesses were virtually unaffected by the tech crash, a very positive sign. Earnings from legacy businesses are still sufficient to fund the new initiatives. Earnings of -5 cents per share, slightly worse than forecast. Projections: breakeven next two quarters (legacy profits continue to be used to fund bluetooth and electronic payment businesses). Earnings from bluetooth should start arriving late this year, plus a return of legacy profits to the bottom line, mean profits of 10 to 20 cents a share per quarter starting first quarter of next year, and increasing from there as economic recovery and bluetooth sales kick in. The big unknown is the electronic payment business. Hype on that (mea culpa) is what drove TROY to dizzy heights. E-checking currently generates revenues from brokerage houses, but probably not enough to pay for the costs of electronic payment solutions business. The expectation was that online stores would also go for online check payments as an alterative to credit cards, but that hasn't happened. It still seems astonishing that Amazon.com (AMZN) is willing to throw away millions of potential customers by not having a TROY type e-check payment option. Bottom line is that, over the next few years, the electronic payment business could contribute anything from minus ten cents to plus ten dollars per share per year to TROY's earnings. TROY is now selling for less than book value.

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