*AV*--OKAY - I decided to end with a partial SCREW UP.
To: +Brian Kerecz (15552 )
From: +Andrew Vance
Tuesday, Oct 13 1998 9:14PM ET
Reply #18619 of 15868
*AV*--I was a buyer and took the money today at ~$4. they have a big hole to work out of. I do not see them making a decent run until I see some fabs fill up and a few new fabs taken off the "hold" status and moving forward. I actually think WFR could retreat into the mid 3s again. At these prices, we could see 1/2 to 1 trading ranges, which I will play very carefully.
Andrew
Major run up after this and I hade to get back in $2 higher when it retreated. So there, I screwed up BIG TIME.<GGGG>
Andrew
Can't do it. This is an excerpt from #15625 on October 14th.
WJ-semi conductor sector of business is real weak still. Very few systems were ordered, while spares activity declined in Q3. WJ is not as strong financially and is showing some of this weakness in its present markets.
Upside is (and the reason for discussing this stock) their wireless communications portion of the business. They may see a stronger Q4. A production ramp on two large wireless contracts indicates close to a 40% sequential revenue growth, for nice profitability. Their BE (breakeven) may have been lowered due to some of its restructuring and this may lead to profits, albeit small ($0.20-$0.30 per share) in 1999. Their is some upside to these numbers IF their semi business improves. WJ still has problems that it needs to address, mainly competing in two unconnected markets with inadequate resources. WJ failed to address the issue pertaining to trying to compete in two disparate.
Asset values bear watching since, to me, it seems the asset value exceeds the company's market value. However, not being an accountant or CFO, you never know if the assets are depreciating faster than the support being given to the stock via the share buyback program. We have some gurus in our midst that could actually give an intelligent commentary on this. Are you up to the challenge, my good friend from the UK???
Speaking of book value, IPEC has just blown my shorts off. They report on Oct 29th and Q1 estimates have been lowered to a $0.50 to $0.60 Loss. Estimates of a $1.70 loss for 1998 and only a possible $0.20 profit for all of 1999. BTW-The CFO resigned, which doesn't help matters either along with a diminshing backlog, it seems. Further downsizing could be lurking in the future. Stock might even bottom to its $5 book value.
IF my numbers are correct, you are looking at a possible acquisition by a stronger company since IPEC offers one of the top enabling technologies WHEN the sector recovers and sub 0.25u processing goes mainstream.
While I am still not advocating going shopping for stocks, a new company (to my universe that is), DSP Communications bears your attention. We could be seeing some incremental growth with returns of $0.75 to $1.00 for the 1998-2000 timeframe. Not bad for a roughly $7 stock these days. This is a very long term view and is based on their conference call yesterday, to discuss recent earnings. Hey, I got nothing better to do these days<GGG>.
DSP Comm. reported Q3:98 operating earnings of $0.21 versus Q3:97 earnings of $0.13, in line with consensus expectations. Year over year revenue growth looks good along with a healthy diversified chip set product portfolio. Thats the rub, though, we are talking about a chipset portfolio in a time where the IC industry is gasping for life's breath<GGG>.
It should be noted that their customer base is expanding, which, if sanity returns to the market, should provide a basis for a higher valuation in its stock price. Downside is that this wireless chip set provider is reading about all its customer's profit warnings which could impact continued strong sales and revenues.
Again, I am looking at this long term and am taking a conservative approach to accumulation even though DSPC may be able to dramatically benefit in the form of wireless communications opportunities and maintain a competitive position in the wireless chip set part of the business. Who knows, we might even see it as a key player.
Again, this is all premised on the recovery in this sector.
Andrew |
