Hello again John,
I thank you again for your continued interest in SIGM.
I looked at your numbers compared to the most recent quarter and thought I'd add my 2 cents.
I noticed that you are stepping up R&D to an annual 6 million as opposed to the current run-rate of closer to 4.5 million a year. I'm assuming that you're raising this to compensate for SIGM's need to upgrade its DVD-Rom chip and board to satisfy OEMs. Sounds good to me.
Shares may be more than 12 million with an outstanding convertible preferred issuance. They can't be converted until August, but I'm betting that they will be converted around that time if the holder want's to get in cheap. 5 million dollar convertible will should add at least a million depending on the price level at that time.
I have no idea about the shareholder suit. Sometimes these things take forever, sometimes they're settled quickly. Not a good thing to have to deal with.
Revenues sound O.K. too. Regarding the products other than DVD-Rom, I think the Nestream 2 should get some serious sales soon with Microsoft and other big names pushing the product out the door with the introduction of Windows 98. On the other hand, the other products should experience some decline from Asia problems and lower PC sales. The 40 million other revenues is therefore a guess by me also but depends on the Asia problem and the introduction of Netstream. It could be much higher or significantly lower depending on these two factors, IMO.
I also hope that the DVD-Rom products and Netstream have higher margins than the other product mix to lower the % Cost of Goods Sold as the year goes on and more of these products are sold. I really have no idea about the current margins though.
It should be interesting towards the latter part of the year. As you project and I agree with, the .24 will come in these next three months improving somewhat exponentially, IMO, as most of the sales will come around Christmas, right? Maybe .02, .08, .14? That will look like some nice growth to small cap investors looking for the next CUBE, eh?
Thanks again,
Grant |
