I agree that the market will head lower. It deserves too. PEs on the S&P have never been this high. I raised cash the first part of February, and I'm still holding that cash. This inflow of stupid money is just keeping it afloat, but it won't last forever. Oh BTW, MO is is great numbers play. If you hold it, it will pay you the price of the stock in dividends, before the court battles end.
C-Cube's conference call(Horrible!) was like a groundhog seeing its shadow, 6 more weeks of winter.
In Q2 Cube's VCD market started a transition to CVD. VCD 2.0 chip inventories in the channel needed to be reduced. The Total shipments were 2.8M units, much lower than production, which should have been between 3.2M and 3.4M units. Chinese companies do have quotas.
In Q3, I'm starting to see these numbers:
VCD 3.5M units worth between $35M and $38M, depending on product mix.
DVD has run at or below $3M for 3 straight Qs. Let's just call it $3M.
Divicom's sales were about $36M last Q, $41M in Q3.
Settops were $9M, and should be close to $12M this Q, with SkyperfecTV ramping up, Canal + always does well in Q3, and the build to the Holiday season.
Encoders were about $4.5M last Q. With the new single chips, ASPs have and will continue to drop. Let's just call it $4.5M in Q3.
Total sales for Q3 = at least $95.5M. Take out $2M for reserves and C-Cube should report over $93.5M, 13% sequential growth. Potential areas that may do better are VCD, DVD, and encoders.
Now to get to EPS:
Revenue $93.5M
COG 42M( 55% gross margins, down from 55.5%)
Gross 51.5M
R&D 19.1M
SG&A 14.5M
op income 17.9M
other .6M
Before tax $18.5M
taxes 5.6M (30%)
Net income $12.9M
41.5M shares $.31 per share |
