INTRO Here's my semi-annual exercise to see if I remember why I own the stocks I own, and so I can check back and see if their stories have changed. I post in case it helps others too.
GigOptix
GIG (market cap was $0.043B mid14 is $0.039B EOY14)
GigOptix is a high-tech to the point that a lot of investors in technology don't try to understand it - or buy its stock (GIG), evidently. GigOptix makes very high-speed switches that allow the video streaming and cloud operations that are becoming common. GigOptix's switches include those based on Lumera's technology (a spinoff from MicroVision) using "organic" materials. In this case, organic means using molecules that include carbon, not organic in the farming sense. One of the reasons for the high speed capabilities is that by using the proprietary material, there are fewer, if any, moving parts. There are dozens of applications for the material outside switches, but GigOptix is staying focused on their core business - for now.
Financially, the stock is undervalued compared to other high-tech companies. Most of them are not trading shares at price to sales to price to book ratios near one, as GIG is. Based on conventional valuations, a price to sales of 6 may be more appropriate, suggesting an inherent positive appreciation. The market may, however, be recognizing that GigOptix's growth has not been monotonically increasing. It took a dip in 2013 and may only recover to 2011 levels in their 2014 financial reports. A complicating feature of the company is its history of mergers and acquisitions. While they may be creating an formidable foundation from which to build a much larger firm, they also may be distractions or diversions that make it harder for investors to gain confidence in the core company.
DISCLOSURE LTBH of LMRA since 2004. Holding because I have enough shares to positively impact my life, but not so many that I feel too exposed to risk.
(I've also collected links to the other discussion boards and my other stocks over on my blog trimbathcreative.wordpress.com |
