Patric welcome aboard !!
We did IOM and ZITL together and I respect your analysis and knowledge in eveluating company fundamentals.
As for the revenue for 1997, ceo stated 40 mil for 97 but I could not help feel that these guys will come in much higher some how. The way John, ceo made the presentation, I think he has a surprise in store for us. If I was in his situation I would do same.
According to your .06 I concure but then going back to my argument I expect .08 bringing in line with my forecast of .29 for 97.
However, as you stated with y2k added on value, at this juncture the eps will not matter this qt and even Jan as Skip has pointed out.
As for your $10 value based on 21 million shares was a wake up call. I completely forgot all about the share increase. However I give more conservative figure of 6 to 7 for TPRO today but this can shoot up to the moon based on future earnings expectation on contract announcements.
Its an awesome thing to behold.
Here is an old news item I think new people here will enjoy reading and will give quick glimpse of TPRO s strong points
Topro , on no news reports prompted a flood of e-mail.
Here's the story we've put together from a wide-ranging interview late
today with Topro CEO John Jenkins and his staff.
Topro is a "Year 2000" stock. We carried that alert on our website
(www.tomorrowcast.com) in late June when the shares were at $1.50. That
story also went out on various electronic media such as Signal and DTN,
services used by active traders. But we gave very little information on
how Topro is different from the other "Year 2000" stocks. Here's the
difference.
The high-flying Y2K stocks like Data Dimensions and Zitel address the
management information systems (MIS) side of the problem. There's
payroll to meet, pension contributions to keep straight, and a host of
other MIS problems. But Topro addresses the factory floor problems.
Here's an example.
A smelter company in New Zealand recently "triggered" its Year 2000
problem. The computers that control the smelting process (process
control computers) shut down - all 660 of them. The smelting company
lost $1 million in bad product from the single incident.
Another example concerns a software program used by many factories to
control its production processes. Any company using that software which
turns off its factory floor computer system after the calendar rolls to
2000 will find that the computers will not restart. They'll be dead. No
production. So the problem must be fixed.
Process control systems in factories are often custom built with hardware
and software from diverse sources. Topro believes it is the only company
with the breadth of experience and depth of database to span the many
diverse components that make up factory floor control processes.
Unilever, for example, has over 500 manufacturing sites. It has told its
factory managers that each is responsible for certifying that it has the
Y2K factory floor problem under control - by October, 1997. So Unilever
has scheduled a meeting with Topro.
But what actually happens in addressing a Y2K factory problem. Firstly,
TPRO does an assessment. The assessment is billed at $1,000 per TPRO
consultant per day to assess the extent of the client's problem. At Sun
Oil, TPRO did the assessment and discovered that the "mission critical"
problems were so dire that Sun Oil decided not to fix the problem.
Instead, Sun ordered complete new process control systems from TPRO. So
TPRO billed for the assessment, and got a follow-on order for $300,000 to
upgrade two sites. Other current clients include Coca-Cola and
Dupont. Merck, Kraft, General Mills and Glaxo Canada are clients on
TPRO's immediate horizon.
Since what TPRO is doing involves mostly expertise and software, the
gross profit margins are in excess of 50%. While there is no agreed on
estimate of how many factory sites will need Y2K "cures", TPRO believes
100,000 sites is a fair estimate. Obviously, TPRO cannot handle that
much work, and currently it is the only game in town. Therefore, TPRO is
working on licensing agreements for its Y2K software. It will talk to
industrial giants such as Rockwell and Square D about an arrangement
whereby TPRO will train and license their personnel in applying the TPRO
Y2K solution.
The key to TPRO's proprietary position in fixing this problem is its huge
database. TPRO has mapped the factory floor problems in the $250 million
of process control consulting it completed prior to the Year 2000 problem
surfacing. Factory floor software is in "layers", and the layers may
originate from different companies and be patched together by customized
code. TPRO has a search engine (think of an internet search engine) that
sifts through the layers and finds the mission critical Y2K problems in
the client's software.
So why all the volume today? Wall St. finally figured out that the Y2K
solutions offered by the MIS-oriented companies like Data Dimensions
won't work for the factory floor. And if the factory floor shuts down,
that's it. Right now, only TPRO has a solution. And Topro already has a
blue-chip client base. Over the years, TPRO has solved problems at 5,000
factory sites and includes Boeing, Amgen, Coca-Cola, Cypress-Amax,
Hershey, IBM, Dupont, Merck, and others in its customer base.
Also, unlike the other Y2K companies, Topro has a profitable business in
addition to the Y2K factory floor solution. TPRO's core business earned
$.05/share in 3Q on gross margins of 36%. Sales are running at $50
million per year and already increasing rapidly. The Y2K solution, with
its fat profit margins and relentless approach is "something extra" that
whet Wall St.'s 2.8 million share appetite today.
I hope this answers the many diverse questions I received today about
this Venture Returns' featured stock.
Wishing you peace and prosperity,
Karl Drobnic, Publisher
Venture Returns
tomorrowcast.com |
