Amadeo, The site is interesting. Note, however, that Vector Vest's definition of a company's "value" is only based upon earnings, earnings growth rate, dividend payments, dividend growth rate, and financial performance.
Using that definition of company value, ZE is grossly overpriced. A much broader definition of value indicates the contrary.
A company's value should also include its brand name, management, work force, proprietory technology, sector analysis, distribution system, partnerships, etc.
An argument could be made that Zenith's true value is approximately $4 billion.
The brand name alone could be valued at about $1 billion. Zenith is one of the top ten most recognized brand names in the world.
Zenith's patented VSBi transmission standards could be valued at another $1 billion in royalties within the next five years.
Set-top boxes and cable modem contracts are approaching several billion dollars and the market is just heating up. Thus, these divisions could be valued at over $1 billion.
Future SDTV, NCTV, HDTV sales projections could be valued at another $1 billion or more
This doesn't even take account of Zenith's early exclusive distribution rights for Divx and other CE categories/items which Zenith can successfully market. My read is that audio sales will be a big profit generator as early as next year along with Divx sales.
Timing is the key issue. Zenith's true value, most likely, won't be demonstrated in the near term. When it is, this is a $50 plus stock. |
