Yesterday's conference call . . .
Pretty much "just the facts" ambience. A number of analyst questions about cellular market. Trimble's remark that GPS in cellular infrastructure and in handsets as "soul mates" was interesting. To the engineers: Was he implying that Trimble has a technical reason to leverage GPS in base stations to GPS in 911 handset locators, etc? Noticed he also mentioned "early" interest by telecom infrastructure players in GPS, although there was no real discussion of Nortel at all.
He also said, offhandly, that he thought TRMB was gaining market share, if I heard him correctly. The CFO's remark that he expects a 52.5% to 53% margin next year also heads in that direction. I can't figure why they announced the 4800 surveying product in August to overhand the market until December and lose sales.
Obviously, Trimble was impressed with the manufacturing output in December, saying that he thought he would have "died and gone to heaven" if they could have reached $76 million in sales, and then they managed $78 million (over the $76.9 potential Schroder's expressed in their 12/30 report). He did not want to change the 25-30% revenue growth projection in response to a question.
Working with numbers, and I'll be very interested in hearing from Arun and Skip and others, it looks like a $.95 earnings if there's a 22% growth rate (like last quarter) but more like $1.07 at a 25% growth rate. I'll now revise my guess to $1.10 (based on a 26% revenue growth) down from $1.20, but am more confident of at least $.90 or $.95, given that Trimble mentioned they really weren't relying on big orders at this point, and he said they weren't expecting to go on a hiring binge. This would give me a 12 month target in the range of $40 a share.
None of this is to be relied on by any of you out there, of course, and please do your own guesses. |
