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

To: rascalbythesea who wrote (1861)	3/1/2003 8:37:30 PM
From: Sector Investor	Read Replies (2) \| Respond to of 7249

rascal, If you do your DD, the answers to those questions will be apparent. I think it it much better for people to do their homework and get their own answers. Just this once, I will give you my answers. #1 and #3. You need to understand what they spent the money on. The easy quick answer is the development of the A5 antenna for the automotive market, which was a two year development effort, during which time they averaged 24.1% and 18.6% on R&D. The A5 antenna likely will generate revenue measured in the hundreds of millions, so the $4 million drop in cash in 2002 is trivial. #2 They won a large Special Forces military order in September for immediate delivery at the end of Q3 and Q4. The military pays 30 days later, in the subsequent quarter. In Q4, in addition, they received a $500,000 order as well for the US Marines, which also shipped late in December. With smaller orders, that represents about $2.5 million, or about 20% of the quarter's revenue that could be reflected in the A/R line. They have no control over military delivery dates. That is why A/R is up the last two quarters. If you understand why, the increase in A/R is just an effect of large orders shipping late in a quarter. #4 The LT debt has been on the books for some time. Their Debt/Equity ratio is 0.11, which is excellent. #5. KVH management does not have large salaries, so they provide options for key management personnel, just like most tech companies. I don't view this as a problem, do you? Backlog fluctuates up and down mainly with military orders. Three years ago their year end backlog was only $700K. You should start to see backlog go much higher by Q2 as the A5 order backlog builds up. The A5 is going to be by far the biggest product KVH has, for two reasons - the automotive market is 25-50 times larger than the RV/Marine markets, and they have NO COMPETITION in the automotive market. Why should SIRI and XMSR have ANYTHING to do with KVH? The technologies are not the same and they are NOT KVH competitors, and their satellite stations are for Radio, not TV and Internet. Insider selling is related to two main factors - 1) Management strengthening changes which resulted in some former managers leaving or retiring. 2) Options being exercised, where the employee sells some to pay the taxes, and retaining the rest of the shares as a net increase in ownership. The transactions show up as Sells though. Your entire post shows that you need to put more effort into your DD. You need to know more than the numbers - you need to know WHY the numbers are as they are.