The reasons for C-Cube's decline seem to be all technical. Support levels were taken out, one after another. The last hour saw 2M shares trade at lower end of the day range.
This Q, for the first time, Divicom's revenues are exceeding VCD revenues. About $37M for Divicom, and $31M for VCD. Divicom is now 43-44% of revenues. Divicom is a digital video networker. Divicom's rate of run revenues are about $148M annually. Networkers like ASND, CSCO, FORE, trade at over 5X revenues. At 5X revenues, Divicom is worth a market cap of $740M($18 per share). At 15.625, C-Cube's market cap is $640M. And you get the $192M rate of run chip revenue, and about $5 cash. The bonds are already in the share count. If they were bought back, that would add 7 to 8% to EPS.
Divicom is cheap, C-Cube's free. |
