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Technology Stocks : Creative Labs (CREAF)
CREAF 0.411-6.5%Dec 8 12:12 PM EST

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To: ronco who wrote (7614)1/1/1998 2:42:00 PM
From: ronco  Read Replies (1) of 13925
 
A few more interesting points . . . . any thoughts?

CREAF (Creative Technology Ltd)

<- Previous Next -> Message 587 of 588Reply Subj: worried
By: inhuman28
Date: Jan 1 1998 6:47 A.M PST
Reply To: Msg. 1 by YahooFinance

for the 1st time ever i have serious doubts that creaf will beat estimates.

note: revenues in millions/97 1Q earnings not including $.19 from investments.

96 revenues/97 revenues/97 earnings/97 margins
2Q 435/386/$.64/28.3%
3Q 282/283/$.48/31.0%
4Q 292/280/$.55/31.4%
1Q 284/288/$.55/32.9%

by looking at the 4Q and 1Q 97 earnings i estimate that in order to beat $.77/share 2Q creaf must obtain a revenue of around $400 million.

this will not be easy for 3 reasons

1. look at the revenues same Q for 96 and 97 you can see that every Q it's very close (actually most quarters in 97 have less revenues than 96). so creaf need to be around 14 million above 386 million. which it has not shown that it can do for the past 4 quarters.

2. chinglee's news msg #216 sim said that revenues from Asia dropped to 24% from 30%. this extra -6% less could easily be the culprit creaf not be able to beat earnings.

3. msg #216 sim indicates that margins in the low 30s. if margins are lower than 1Q and 4Q of 97, creaf will need more than $400 million in revenues to make up for the lost in margins.
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