<NN is largely a supplier to carriers and service providers, like ASND, which is acknowledged to be a much higher growth buisness than the enterprise, where most of sales of both FORE and XYLN are derived<
Gary, I'm not sure that I completely agree with you on this. XYLN was certainly in the enterprise space only and only got 4x revenue. This, in spite of the fact, that they had the highest growth rate of any of the significant players and were clearly more profitable and growing profits more quickly than anyone else, too. FORE, on the other, is more like NN, they've got some nice products and really mediocre business management. They too are all over the place in terms of the markets and applications they'd like to sell into. Like NN, they can't seem to develop any sustainability to their profits, maybe the new owners will be able to do something with this.
At any rate, even if you use an 8x multiple for the non-TDM business, assuming that this is what a buyout partner really wants, then you probably also have to assume that that TDM part is worth little to the same acquirer and its closer too 1x. Using these multiples you still only have somthing like a 40% premium over today's share price.
My question still is, what are the expectations of longs? Is this a 20B market cap company in 3 years? $50B in five? What's the story7
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