I wonder about that RB reiteration; how could it be otherwise since RS announced coverage and a Buy on December 22nd. What analyst could do an about face so quickly? Did RS know about this then? These questions about the RS reiteration leave me wondering.
As to the $1 in earnings, I think that RS said .77 (reflecting approximately 30% growth in earnings year over year), which leaves the need to exceed the RS estimate by 40% to reach one dollar. I will be looking to see any other revisions by other analysts regarding next year as to whether they believe, in an environment of declining quarter-over-quarter revenue, with now-declining service revenue as a percentage of overall revenue, this coming has real prospects of growth. The RS numbers are based upon revenue of $100 million for next year for this company, which has seen sequential declines (3) in revenue, down to yesterday's announcement. Thus, not only does the decline have to be reversed, average revenue per quarter must increase by approximately 35-40% over Q4 for fiscal 1998 just ended. This is a tall order for any company. . .so I wonder what the real prospects are at this point? |
