Wayne - when I read your post I almost felt like we had coverage. Great work, thanks for sharing.
Some thoughts about Q1.
If I understand correctly, in the past the work force was reduced due to a reduction in demand for product (post Xmas). I'm not sure this will be the case in this Q1. I know that's what was talked about in the CC, but the truth is there are still very few toys on the shelf in my area. Lots of space and hooks just no toys. This leads me to believe that we will see a continued demand rather than declining. I think this is unique to this year and the fact that we sold everything before Christmas. If Radica adjusts their workforce (crew size) based on demand the main adjustment could be CNY. It will be interesting to see when the dust settles. (also concider what J said about returned product)
Agree that Q2 could also be higher than Q1 because of CNY but also we might see shipping start on some of the new products, mainly NASCAR Racer.
Whatever we figure it at, it is going to be a great year..
Here are some crude numbers to play with based on Waynes numbers and previous percentages (25% -75%, first half - second half). This worked pretty well last year.
Q1 .45?
Q2 .50?
Q3 .86?
Q4 1.99?
1998 3.80? (very conservative I think)
PE range 10-20 = price of $38 - $76 for 98
For you old pros. (That's any one who has been around longer than myself, basically everyone).
Do any of you feel that a toy stock could be valued at $76 per share? I would guess we will see some PE compression due to price in the upper end.
If you agree, what would be the logical course of action? 40 million shares? Where is this headed? How can you make 20 mill into 40 mill? Hm. Float is already a little small. Hm.
Educate me, I haven't been around this type of growth before. Is this probable or just irresponsible posting? Forgive me if it is, I hope not.
Anthony
PS I've learned a lot from you guys, hope to learn a lot more in 98. Thanks. |
