Bull, its the market playing havoc with a great new technology company. HLIT has never lost money,never. They have expanded rapidly,and still they are not losing money,doubled their workforce of engineers. The difference with HLIT and companies like AMTX or AWRE is,that if they fall who knows where the bottom is,they have very little earnings and revenues. On the other hand HLIT has value at 13,its is 2 X book,1.5X revenues,this is execellent value,in fact the best in the telecom industry. Also they are the only company installing DWDM in Metropolitan networks,splitting digital and analog transmissions,no on else is even trying to do this. They have just bought New Media Communications from Israel,that has a contract with CVUS,for digital products for LMDS. If CVUS's LMDS catches fires with the spectrum auctions this December(if they occur,the RBOC's have been blocking it),then HLIT is in the catbirds seat.
HLIT is not down,its the perception of LMDS,due to the fact that Bell Atlantic sold their stake in CAI Wireless. But they are not using LMDS,but MMDS which does not have the spectrum or capabilities of LMDS. Also on the perception that cable companies will not upgrade to HFC. Well to deploy telephony and cellular,you must upgrade to HFC. The small companies might not,but the big ones will. I have not seen their earnings,just preliminary data,they have over 60% of the sales outside the U.S. This might be do to currency fluctations in Southeast Asia,or the strength of the dollar.
UNPH sells for 10 X revenues,12 X book,as do many other fiber optic companies. Sometimes its just not good to have earnings and profits in new areas of technology. I love what HLIT is doing,and where they are going,and their management,their PR sucks really bad though.
Investing is not an intellectual persuit,but a game for anyone with a third grade education. Anyone can play this foolish game,even children,and sometimes thats what I think institutional investors are,scared little children,panicking at anything.
Tim |
