Latest from TSC's H. Greenberg....
Speaking of which, more Iomega insanity: Enough, already, I know! But the story continues to unfold. The latest twist: Longtime bull Joe Besecker of Emerald Research downgraded the stock to a neutral, based on a quarter that he says is well below expectations. He says he expects the company to lose 3 cents a share in the current quarter, with the year coming in at a profit of 25 cents per share (down from his previous estimates of a positive 2 cents and 41 cents, respectively).
Besecker adds that he believes it's time for the company to "better articulate" its long-term strategy.
Good point, especially since the company's just-released 10-K disclosed that backlog at the end of January had tumbled to $71 million from more than $200 million a year earlier. The company also disclosed that it has, once again, rejiggered its agreements with its bankers as they pertain to the required minimum level of EBITDA required for its fiscal first and second quarters. The last time the company redid a bank deal was last June, "and we delivered on everything we said we were going to do," says Treasurer Rob Simmons (a straight shooter if there ever was one). "...However, we told them we needed more room here, which is normal."
Normal, maybe, but not a good sign at a company that trades at such a hefty multiple to its disk-drive peers and its book value.
BBG |
