Zeev an interesting company to say the least. Here are some ratios comparing them to industry that you may like.
marketguide.com
One can not debate the fact that unlike most internut companies, they are making money. I found some of the information on the following financial recap useful and had some thoughts for you,
marketguide.com
1. I noticed that sales for the 4th quarter from last year were 62 million vs 72 million this year representing a 62% increase. How much has the acquisition of Logicsoft in September of 1997 contributed to the revenue increase for the first 9 months?
2.The numbers that really keep jumping out at me are the first 9 month comparison numbers 97 vs 98.
1997 114,921 .485 per share
1998 158,434 .34 per share
38% less revenue yet 42% increase in earnings per share. With the direct sales business they are operating on less margins. How much of an effect do you see it having on the numbers. I understand the economies of scale when doing business via the internet and hopefully as you have previously mentioned it will help to reduce the receivable situation. The S/G and A expenses are already running pretty low. Do you see them going to be able to go much lower?
>>SG&A expenses have decreased as a percentage of revenues to 9.8% from 11.3% for the three months ended September 30, 1998 and 1997, respectively. For the nine-months ended September 30, 1998, SG&A expenses have decreased as a percentage of revenues to 10.1%, down from 11.2% for the same period in 1997.<<
It also appears that the margins are going to continue lower or am I missing something?
>>Gross margins have been affected by the mix of products sold and the mix of distribution channels. Historically, the gross margins attained in the catalog channel have been higher than either the direct sales or distribution channels. Margins within the direct sales channel are also subject to mix variations as Microsoft Select License sales typically produce lower gross margin results. For the nine-months ended September 30, 1998, catalog operations contributed approximately 31% of revenue and approximately 46% of gross margin dollars as compared with approximately 46% of revenue and approximately 64% of gross margin dollars in 1997. Direct sales operations contributed approximately 62% of revenue and approximately 46% of gross margin dollars as compared with approximately 43% of revenue and approximately 26% of gross margin dollars in 1997. The distribution channel contributed approximately 7% of revenue and approximately 8% of gross margin dollars as compared with approximately 10% of revenue and approximately 10% of gross margin dollars in 1997.<<
All of that being said, it is still hard to assign it the value that it has been receiving in comparison to other internut stocks. Unless they view the others growing eps and PROG decreasing eps. That won't even matter if the heard jumps on <g>.
Cary
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