<<In response to a challenge as to what he would tell discouraged long-term stockholders, Charlie Trimble said it would be a real shame to get out and miss a positive move. "Competitively, we are in an incredibly better position than two years ago. We are definitely winning the long term race. There will be some nice announcements over the next quarter or two.">>
I'm about as long TRMB as an individual investor is likely to be, but even I have to say that about the only announcements that I would view as "nice" in the next quarter or two are:
3Q - "TRMB bounces back with 17 cents per share on 15% higher sales and improved margins"
4Q - "TRMB surprises analysts with 25 cents per share on all-time record quarter"
The bottom line is that most serious investors already know that TRMB's patent portfolio and product development are first rate. I don't think more product announcements will help for now. What investors on the sidelines are looking for is evidence that the intellectual property really has lasting value and the management team can leverage the IP to create market pricing and earning power for TRMB.
I remember in '89 or '90, well before the IPO, Charlie had come back from a road trip hyping TRMB to institutions and he was enjoying telling the story of how he got an ovation from a Japanese audience when he told them that he ran TRMB with a long term outlook and not focused on short term earnings versus some American companies where decisions were made specifically to "make the numbers" every quarter even if detrimental to the health of the company. This was a very pointed story back when Japanese companies were dominating the electronics industry and American companies couldn't seem to do anything right. But today, Japanese companies, giants though they are, still don't earn much (even ignoring macro-economic factors) and their stock prices have floundered while American stock indexes have quadrupled in value during the same period on earnings improvements.
In the end stockholders don't buy patent portfolios, product announcements, management teams, or market share; they buy a discounted future earnings stream derived from the above ingredients. |
