Hi Mark Jordan.
I, like you, am a big DGIV fan. DGIV is in the right place at the right time to make some nice money in the coming years. I have picked up shares at various prices in the last several weeks. DGIV occupies a comfortable percentage of my portfolio.
I have seen so many numbers flying around and DGVI has made so many acquisitions in the last couple of months that it has been understandably difficult to project an honest estimate of revenues for 1998. Roger Templeton, DGIV V.P. of Communications, is a very pleasant, knowledgable man. Several times I have spoken to him to try to figure out some financial estimates for the upcoming years. To his credit, he was reluctant to give me any real "ballpark" figures much less any think with any meat. DGIV is at an exciting transition period where they are signing numerous deals and moving from hardware
and software sales to more "line-based" revenues. I'm sure Jimmy and Co. have profit margin goals and an idea of what kind of revenues these deals will generate, but up until now Roger has been very closed mouth about giving out specific numbers.
Well, today I spoke with Roger to see if I would have any more luck and here's what I got. Apparently Bob Cummings, company president, (apparently the financial guy) gave Roger some numbers we could chew on. For 1999, DGIV is looking for ballpark revenues in the $70-100 range. Roger said to use the industry average for a profit margin estimate (what, 20%). He would not comment on '98 revenues as they are not quite sure how quickly these new ventures will ramp up. My own guess is around $30-40 mil.
By the way, the number of outstanding shares is around 16,000,000.
I come up with around .66/ share earnings for 1999.
(assuming 30% tax rate)
50 P/E gives you $33 a share.
The stock looks like a helluva deal right now. Nasdaq applications will give us a boost. But, the big money has to see some financial projections they can sink their teeth into, and I think DGIV's are shaping up nicely.
I welcome all comments.
Mark |
