Art, I appreciate your knowledge and comments but I humbly disagree with your appraisal. IMHO, SNDK profits may be rising but not because they are especially good at marketing their products. Digicams are finally selling well and the rising tide is helping everyone -- even the least capable of boats.
SanDisk cards are, as you mentioned, "widely available" -- but so are Lexar, Kinston, PNY, and a host of no-names including house brands. Not to mention that Crucial/Micron has added a nice selection of flash to their website. At this moment, you can buy flash memory from almost everyone and nobody seems to care who made it or how fast it works or ... anything. So ... it is reasonable to expect that most people will buy the cheapest card they can find.
From what I see in the retail stores and at web sites, SanDisk is billing itself as the leading supplier of generic product. Meanwhile, the competition is offering lower-priced generics while LEXR and others are offering higher-priced premium products.
To be brief, SNDK has failed to create a "brand image" in the marketplace. Their product neither overwhelms their competition (as in Coke versus Pepsi versus all others). Nor has SNDK created a "premium brand image" (as in Gucci versus Taiwanese knockoffs). Without the benefit of product differentiation, SNDK cannot reasonably be expected to obtain the profit levels it requires to justify its current market cap. The stock market obviously shares my view and has recently discounted SNDK's future prospects.
IMHO, "good news" for SNDK would arise if they ever hire a well-known and market-appreciated V.P. of Marketing with the know-how to jump-start SNDK's brand image in the marketplace. If and when that ever happens, I will probably become a SNDK shareholder once again.
Craig |
