Hi John,
Well, it would have been amusing if the company had said something, but after all, what *else* could they say? Bay Networks announced a fast ethernet acquisition about a week or so ago, and the company they bought had no sales and an engineering group encompassing 12 individuals (products won't be shipped until well into the first quarter) and the acquisition was still in the ballpark of $ 100 million. Comparably, Network Peripherals has about $ 45 million in cash, no debt, an FDDI business that is worth perhaps 1.5 times sales (or approximately $ 65 million) and the total market capitalization for the company (even at $ 20 per share) is less than $ 250 million.
So, *it's* fast ethernet business is being valuated at less than $ 150 million, and they have many shipping products and rapidly increasing sales. NPIX's fast ethernet sales will most likely be a minimum of
$ 40 - $ 50 million in 1997. Obviously, on an acquisition basis, this stock is still under what other deals are going for, and, it has added scarcity value as one of the remaining few companies still able to dance. In short, speculation on an acquisition in NPIX has more credibility than most of the rumormongering that is endemic to Wall Street. Earnings should be reported in a week or so, and preliminary indications are that top line growth will continue excellent, indicative that the company's products are gaining market share. This is most likely an interesting takeover speculation that is coupled with improving fundamentals. |
