Well, I listened to it last night. Not much time right now, but the major points were: swung back to profitability a quarter ahead of time; op ex costs dropped $66m, also a Q ahead of time; SDLT320 well received, DSS has regained about 2 points of share last Q, on top of 2 more points of share the Q before (bad news is--they ahve a lot of share to regain: their share is down to 38-40%); their roadmap has them qualifying the next gen of sDLT this summer; Benchmark contributed $15m of sales after deal closed in mid-Nov (though they wouldn't commit saying that this means that Benchmark will contribute $30m of sales this Q--seasonal factors, other variables make prediction impossible); they are cautiously optimistic for the future, though see a flat Q in Q4 (which would still be higher than current estimates from analysts).
All in all, DSS is not out of the woods. They must continue to execute, must get the next gen of SDLT out the door ON TIME, and it must be as sound a performer as the 320 is. If they can do that, then I think double digits are possible again in the next 12-18 months. If not, then the stock will do an EXBT drip.
I wouldn't be surprised to see a slightly higher trading range established for the stock here, into the 4s or maybe even 5s (though that is unlikely given general market conditions). Probably will swing between $3 and $4.50.
All my opinion only, obviously.
Sam |
