No one in this any more? It was a pick of Zoomtrades.
Here's their write up--Madly
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Micronetics Wireless Inc. (NASDAQ: NOIZ)
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The ZOOMTrades Profile for Micronetics Wireless, Inc.:
Ticker: NOIZ
Exchange: Nasdaq
Price when posted: 2.00
Shares Outstanding (Mil): 3.77
Float (Mil): 2.00
52 Week High: 3
52 Week Low: 1 1/4
Mkt. Cap: $6.6 million
Micronetics Wireless designs, manufactures and markets a wide range of test equipment
and components used in the design, testing and manufacturing of cellular, PCS,
wireless local loop and satellite equipment. Through its Switching Products Group,
it also manufactures components primarily used in radar, electronic intelligence,
wireless communication and simulation applications.
NOIZ shareholders have to be wondering what the company has to do to get recognition.
After all, the company has been substantially profitable in the past, and through
its own continued success and integration of its acquisitions, should be able
to greatly increase revenues and profits. Management at NOIZ has done a terrific
job of managing costs, and it shows up on the bottom line: Earnings of .03 and
10 per share for the three and nine month periods ending December 1998. Evidence
of this cost-cutting is seen in the Net Margin of the most recent 3 months vs
same period 1997: 10.5% versus 9%. This Net Margin increase was achieved despite
slightly declining revenues.
NOIZ's strong financial position has allowed management to pursue two significant
steps in furthering the company's growth and profitability prospects:
1) On Feb.19, 1999, NOIZ acquired Vectronics Microwave Corporation. Vectronics
manufactures and markets microwave control components, including phase shifters,
switches, attenuaters and vector modulators. In making the announcement, Richard
S. Kalin, President and CEO of Micronetics, stated: "The acquisition of Vectronics
signifies Micronetics' strong commitment to expand its Switching Products Group
market offerings...This acquisition, and our recently completed acquisition of
Microwave & Video Systems, Inc., is expected to increase Micronetics' fiscal
year 2000 revenue base by approximately 45%".
2) On Mar. 17, 1999, NOIZ announced that its Board of Directors authorized
the repurchase of up to 5% of its outstanding shares of common stock. Kalin
commented, "Because of the low valuation of our stock, we believe that the current
stock price does not reflect the long-term opportunity and value of our company."
RISK PROFILE:
An investment in Micronetics Wireless shares for the short, intermediate, or
long-term horizons should be considered only for those investors with an aggressive
or speculative risk tolerance. Despite the fact that NOIZ shares carry a trailing
Beta of .84, and that the company is strong financially, micro-cap companies
often suffer from a lack of recognition and therefore may never reach the price
potential of other similarly strong companies sporting higher share prices.
This is deemed to be the primary risk of purchasing NOIZ shares, not business
risk, because the company has demonstrated profitability and increasing shareholder
equity over the past few years. However, NOIZ shares could potentially add return
and diversification benefits to a portfolio that lacks equities of an aggressive
nature.
CONCLUSION:
Analysis of the company's financials, its prospects, and its effective management
team should lead investors with the risk profile above to the same conclusion
as mentioned by Mr. Kalin: NOIZ shares are undervalued at current levels. If
Kalin's revenue base predictions are correct, NOIZ could generate up to about
$6.8 million in revenues for fiscal 2000, and if costs are contained in a similar
manner as in the past, EPS could approach $.22. This EPS figure takes into account
the current Net Margin of 10.5%, and a share reduction to 3.2 million due to
the buyback.
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