Spectrian Co. (SPCT) Message Board

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Technology Stocks : Spectrian Co. (SPCT)

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To: Leo Francis who wrote (718)	5/6/1999 11:18:00 PM
From: TOM KARIS	Read Replies (1) of 738

Look at it this way, Stock was very strong today in weak market. Low volume at these low levels which means that WEAK holders have come out of stock. June Qtr should be in the $30+ range with a small loss. There are 5 "holds" on this stock, if they ever start to upgrade and they will probably before the June release we should be at double the levels we are at now. At $13 or so market cap is about $140M - $60M cash = $80M company. $80M for a company with 600 employees of which 119 or so are highly skilled RF engineers. Powerwave has $640M Mkt Cap and same amount of cash. 460 or so employees. I believe management met with MAJOR disgruntled shareholders prior to earnings. That is why the stock bounced off the $8 level to $11.68 prior to the earnings release. I am assuming that they were telling them that the outlook is getting better for fear of any surprises that would call for some changes at the top. I believe there is a shareholders meeting coming up this summer. If the stock moves higher prior to June release you know that they will have a blowout number and outlook for Q2 will be better. I am looking for $25 by June when hopefully all the upgrades will come.I can't see this stock at this level much longer. We broke through the 200day moving average and through $14 we go quickly back to $20 where we were prior to missing the March Qtr. Last qtr was used to clean the slate and set SPCT for a new beginning with lower cost manufacturing which should give us 5 points of gross margin increase from best past case of 30% to the new GM of 35% with the new higher margin products. In a peak revenue cycle of say $45-50M company should be able to earn $0.40-$0.50 per share/per qtr. Annualizing the low estimate gets you $1.60 with a forward PE of 20 which is historically in the middle of SPCT p/e range of 10 to 30 I come up with a $32 price target. Which is still valuing the company at $350M or so, which would come out to aprice to sales ratio of 2.0 granted they do $160M or so in revenues. This can all be avoided with a buyout from Powerwave (PWAV)for a 1 for 1 exchance ratio, but that is a dream on my part. But it would make sense, at least for me.

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