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Technology Stocks : KVH Industries, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Sector Investor who wrote (1505)	10/22/2002 1:38:57 PM
From: Sector Investor	Read Replies (1) \| Respond to of 7249

And I responded with some analysis. =========================================================== <<He said he got excited when he discovered some great product, a dynamic management, and something that has a competitive advantage. ... He said, then if you have a great product, great management, then you've got a company that could become a Microsoft.>> Them's big words, pardnuh. Back in the 1980s, the phrase might have been "the next IBM". Who back then could have identified Microsoft as a potential candidate to surpass IBM? It took many years for the world to come to that recognition. Lots of things can happen between here and there, but let's not dismiss that out of hand. Let's examine those three qualities and five criteria further. Dynamic management. We definitely have that. Back in 2000 we were just turning profitable, when Martin saw some "Brass Rings" in the marketplace and reached for them, knowing it meant more losses and giving a large chunk of the company to institutional investors to raise cash. Now we are back, not only with improved products, but with MUCH LARGER markets opening up to us. Competitive advantage. The key to ALL of KVH's products is their special Polarization Maintaining fiber that they got with the Andrew Corp purchase. This is sometimes overlooked here. It's the polarization properties that allow all the technology based on it to work. The fiber, the entire production process, and key aspects of their technology all ALL PATENTED. They MAKE the fiber inhouse. This is a HUGE COMPETITIVE ADVANTAGE. Great Product(s) We certainly have that as well. TracVision now has a stranglehold on the RV market. The Inmarsat products and service have similar advantages because Inmarsat's coverage is truly global. TACNAV is now integrated into many military programs, domestic and foreign. The DSP technology, further enhanced by PhotonicFiber technology, has brought KVH FOGs into the tactical grade area, opening huge new markets, and they have significant price, performance, size, weight, vibration, usage life gains over their mechanical ring-laser gyro, or oil filled transformer competition. KVH does indeed meet these three qualities - in spades. The five criteria. #1. Dramatically accelerating earnings. We're not there yet, but we WILL BE in 2003. With no income tax for the first 30 cents or so of earnings and top line growth seemingly assured, the bottom line will accelerate faster than the top line. The penny we just made should be a dime or more per quarter before the end of next year. In 2002 though, we have dramatically accelerating REVENUE that will approach 50%, and a cross over to profitability. Let's call this a pre-cursor of things to come. <g> #2 Strong balance sheet. No debt or virtually no debt. I don't have to elaborate on that criteria. We meet it. #3 Strong relative price strength. A picture is worth 1000 words, right? Gee, let's use MSFT vs KVHI over the past two 1/2 years.http://www.siliconinvestor.com/research/comp_chart.gsp?cs=KVHI&cs=MSFT&cs=&cs=&cs=&cs=&cs=&n=30&p=month or against the general market:http://www.siliconinvestor.com/research/comp_chart.gsp?cs=KVHI&csi=COMPX&cs=&csi=INDU&cs=&csi=SPX&cs=&cs=&cs=&cs=&n=30&p=month We meet this criteria too. #4 Wants companies in industries that are doing well in the market pricewise. I'll stick with the graphics. Defense sector since 9/11: (Boeing is a special case because of the airlines, so omitted) siliconinvestor.com RV sector. Fleetwood is also a special case because they do a lot of modular housing, which was hard hit by the economy. Included. siliconinvestor.com I don't know of any direct comparisons for FOGs and sensors. We seem to meet this criteria too. #5 Low institutional ownership. This is not as low as the Guru would like. This would likely be more so the case if I hadn't been here posting the last two 1/2 years, waving my hands. <g> Institutional ownership is just under 43% Perhaps we can grade a half point here? nasdaq.com So I make it 3 1/2 out of five on the criteria right now, and 4 1/2 out of 5 by next year, plus all three of the qualities. I think the Guru might pick KVHI if he was aware of it.