Art,
The company did not revise, which tells me that, under the full disclosure provisions of SEC rules, the company found no need to revise.
It depends upon ones definition of what is a "material" event.
I can understand your frustration with regards to SNDK, but one also needs to understand why the analyst at Bear Stearns lowered their GM guidance. Remember, the two key drivers for valuation creation are Increasing Revenues and Increasing Margins
The analyst basically believes that GMs are falling due to yield issues and additional price declines in the 4th Quarter.
Regarding the analyst's below consensus forecast for GMs, the analyst wrote:
"We believe margins likely fell short on both the captive and non-captive business, an that there was an increased mix toward the lower margin non-captive business due to yield issues at FlashVision, its joint venture with Toshiba" (Emphasis added)
"We estimate SanDisk increased the non-captive portion of its sales from 35% in 3Q to approximately 40% in 4Q, versus guidance of maintaining the non-captive portion at 35%. We believe SanDisk's non-captive product gross margins came under significant pressure in the quarter. On the captive side as well, we think margins were below the company's expectation, given the greater than expected price decline and the yield issues with 90nm production." (Emphasis added)
It's easy to blast analysts especially when their opinion differs from yours. Of course, the difference of opinion creates an opportunity if you have sources of information that refute the analyst's thesis.
Dave |
