To All: This was first posted by Joseph Beltran this AM:
Saw this on AOL. First time copying. Hope it works...Here it goes...
Subj: CFO says x2 avail in hours
Date: 97-02-20 10:34:06 EST
From: RockRoland
Our analysts spoke with DLJ securities and confirmed the following report - we have a call in to CFO. The word is that x2 will be released essentially today - obviously a positive for the stock:
02:58pm EST 19-Feb-97 DLJ Securities (Buck, Eric C. (212) 892-4264) USRX
U.S. ROBOTICS: x2 Expected To Ship Within 24 Hours; RL Buy Reiterat
U.S. Robotics has come under pressure given expectations for x2 modem
delivery earlier this week were not met. The shipments were delayed a
couple of days to add a final piece of software code to ensure that the x2
modems are as bug free as possible when they go out the door. Several
rumors claim that the shipments have been delayed until early March. In
discussions today with management, these rumors were adamantly denied and,
in fact, the modems are expected to leave the factory this evening or early
tomorrow morning. We expect the x2 modems to be on shelves of major
retailers such as CompUSA by the weekend. We continue to believe the
imminent release of x2 at the retail and ISP channel will prove a strong
near term catalyst to the shares which we rate of RL Buy.
IMPORTANT POINTS
We believe that shipments of USRX's native mode x2 (56Kbps) modems to the
distribution channel will be underway within 24 hours. Due to the priority
of some channels over others, we do not expect all distribution channels to
receive the product simultaneously. Large retailers who receive product
directly such as CompUSA should be among the first to receive the new
modems. Our checks at a local CompUSA revealed that they expect the product
on Friday. The beta testing of the software code at the ISPs is essentially
complete. We expect a strong marketing program advertising the availability
of x2 modems to begin imminently.
We expect the release of x2 and the announcement of its availability by
major ISPs to dispel the concerns that x2 does not work or that it will not
be deployed by the ISP's.Further, we expect its release to spur modem
demand in the market with USRX, as the only company offering broad
availability of the technology at both ends (the desk-top and the ISP)
gaining meaningful market share.Our discussions with ISPs have indicated
that nearly all have tested the x2 technology while we have yet to find a
major ISP that has seen or tested working versions of the Rockwell based
technology.
Because of the timing of the release ofx2, the March quarter will, as
expected be rearend loaded.At this point, sales through the channel are
on target and channel inventories are somewhat below their Dec. 31 levels.
Days receivables have been worked down to the mid 60s level though we
expect that number will climb back into the 80s as demand is stimulated
with the release of x2.We estimate the March quarter earnings will hit
$0.76 per share versus $0.55.
With the shares trading at 17.4 times our calendar 1997 estimate of $3.50,
we believe they represent very attractive value given the company's high
growth rate and unique position in this rapidly growing market. We believe
that the shares can sell for better than 25 times our calendar 1997
projection, or at $95 per share. We continue to rate the stockRL Buy.
See: techstocks.com
Craig Anderson |
