Delays in earnings releases are almost never positive, but I think all the news surrounding the company is short term in nature, ie. asia. I do think some investors/traders may be misinterpreting the extent of this slowdown. For example, if you read the press release carefully, it says "The Far East accounted for approximately 23% of the Company's revenues for the first NINE MONTHS of 1997. The Company believes that revenues from the Far East will be approximately 2% of the Company's revenues in the FIRST QUARTER of 1998."[Emphasis added]
To assume that, for this year, nine month total revenues will fall by 21% is ridiculous. Nevertheless, I agree for the last earnings period, Orbit will probably report quite a loss.
I too agree this is the "best one" of all the stocks I follow, and I hope the irrational market makers will spike down the stock on the news, so I can cheaply add to my already large holdings in Orbit.
I don't see six months as long term, when I say that long term this stock is dirt cheap. I look at the corporate performance for the last five annual periods, and I get a clear picture how well the company is run on an annualized basis. The annual estimate of $0.74 a share was reiterated by Orbit's CEO, which means that at $11.25 the stock trades at only 15 times this year's earnings, and 11 times next year's. This for a company with average annual sales growth (over the last 5 year period) of about 30%, and with average annual earnings growth (over the last 5 year period) of more than 130%.
Given that industry growth will be as good or better over the next five year period (which is my understanding), by Sep 2002 we're looking at annual revenues exceeding $360 mil. and earnings exceeding $160 mil. - this for a company with a current total capitalization of less than $72 mil. Given Orbit's apparent strategy of acquiring like businesses, that could accelerate the rate of growth, and my estimates may be conservative IMHO.
Yes, I own this stock, and one should take that into account in considering my future growth estimates, but the historical numbers are fact.
My hope is that this little exercise will help everyone put this "crisis" in perspective...
Comments?
regards,
Louis |
