3DO: Hot Games for Hot Machines (THDO) Message Board

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Technology Stocks : 3DO: Hot Games for Hot Machines (THDO)

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To: MikeD who wrote (3309)	7/2/1998 12:01:00 AM
From: Schiz	Read Replies (1) of 4081

That data is actually for the entire month of May. There was an earlier post with a link to data for the last week of may when MMVI dropped out of the top ten. It's not entirely impossible that the reason it dropped was due to lack of supply but that seems a bit too perfect. It seems pretty impressive for a little company like 3do to have 2 titles in the top ten. Hopefully army men will stay there for a while. The earnings estimates I think are around -.11 for this quarter which ended yesterday and will probably be announced in late July (it has been the fourth Wednesday after the close in the past, I'm not sure if it's changed). Over the last month or two Q1 estimate has been raised (less negative) while Q2 and FY99 have been lowered (more negative). I believe that this may be due to increased spending on advertising and development. In the past they have haven't generated much revenue from software sales. Most of the revenue has been from selling off the hardware division, that's why we have the low PE. The pcdata information doesn't give any estimates as far as units sold (at least not that I've noticed). I wonder how many copies a game has to sell in order to be in the top ten (obviously varies month to month and peaks around xmas). They seem to have a pretty strong lineup of games (for a company their size). I think Trip & co. have done a good job planning the transition. They recognized revenue from hardware sales into late FY98 (I think Q4 but I'm not sure, I didn't follow real close between Nov & Feb). Now that the only place they are going to see revenue is from software sales (and maybe M59) they seem to have a good lineup. Army Men seems to be holding up stronger than MMVI. I haven't played the game but I really like the concept (screw realism, let's make a game with plastic men). As I see it there is definitely alot of risk here although I believe a relatively limited near term downside with a near term upside potential (early august) of close to 5. I'm looking for a runup to 4+ prior to the earnings announcement and possibly higher if earnings are good enough. Long term it could go belly up but it could also be a $30 stock (~1B market cap). This will take a few years for sure if it ever does happen. I have a bunch at 2-5/8 and some more at 3. If it hit's 5 then I'll probably sell the shares I bought at 3. I'm holding the majority for the long haul (unless the outlook changes, still need to find out about the games to be released next year). Bottom line is there are a lot worse $3 stocks to put your money into. If there was no risk , it wouldn't be $3. Do your DD and good luck. I apologize for the longwinded post but it's been a while. (I could write double what I have but nobody would read it anyway so what's the sense) PS Some of the numbers above may not be 100% correct, I'm going from memory. Go to yahoo, get a quote, click on research and click on detailed research for earnings estimates and revisions.

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