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Non-Tech : Any info about Iomega (IOM)? -- Ignore unavailable to you. Want to Upgrade?

To: Cogito who wrote (44786)	1/23/1998 8:02:00 AM
From: Ben Antanaitis	Read Replies (1) \| Respond to of 58324

Allen, Good Morning! Fasten you seatbelt, we're about to get the CNBC SquawkBox spin on the earnings and aftermarket action..........

To: Cogito who wrote (44786)	1/23/1998 9:14:00 AM
From: Ken Pomaranski	Read Replies (2) \| Respond to of 58324

Yes, Allen, I can be too negative! The right answer probably lies right in between, which is why you need the bears here! There are 2 items that I want to clarify (mostly to others, not directed at you, Allen) that being R&D, and the 'treadmill' effect: TREADMILL EFFECT: First of all, the treadmill effect refers mainly to revenues, not earnings exactly. Obviously, they will lower the cost to manufacture the product significantly at this point in the learning curve. The treadmill effect is apparent if you look at the Americas. Revenues in aftermarket only increased 20% even though unit sales were up at about 70%. R & D SPENDING: This is where you have to use your heads, guys! KE said this: Iomega will increase advertising spending to over $100M WITHOUT IMPACTING EPS. This means one of two things: (1) The extra money is going to come from outer space (2) He will reduce spending somewhere else to balance this out. A company has three major elements: marketing, R & D, manufacturing. If marketing spending increases by $100M, where would the money come from? Would they manufacture it? or spend less in other areas? I think the answer is obvious without having to spell this out. TIE RATIOS: Very bad news here. Obviously, people have enough of these. They are not throw-away items... kp

To: Cogito who wrote (44786)	1/23/1998 9:26:00 AM
From: Tom Gebing	Read Replies (3) \| Respond to of 58324

<< how anything in that conference call is going to move this stock up >> Allen, your post sums it up pretty much so....... We will get some panic selling for sure with the stock settling back to a real level based on a revised PE ratio...... I suspect that earnings revisions will be forthcoming and the stock will level out at a PE in the mid 20's..... Based on a forward looking PE the fair value should be in the mid teens. My thoughts; The CC suggests that unit growth will continue, but based on the fact many new owners are not using the Zip to it's fullest potential, tie ratio profits may suffer. This is why the lower tie ratio is a problem now and foreseeable future. They realize the need for new uses that require heavier use of the disk, like Buzz. Since many new units ( built in ) are going to novice owners there is a need to educate users on how the Zip makes computer life easy and fun. This will be a bold and costly move in educating the general public, but one that is necessary. The tie ratio issue is not a new subject. If IOM had given us the tie numbers in the past we all would of seen it clearly. A few bears here where on target, whether by luck or not is immaterial. The key now is the results from their efforts to increase tie ratios and the success of new products, like Click. I do not expect Click to be a 98 success story, 99 at best. The OEMs support for the product after qualifying review will be it's key. The after market version is not going to penetrate the mass market like an OEM inclusion will. Therefore, I will be watching for the OEM reviews and acceptance. Also the 12.7mm laptop. I do not expect big results until the laptop OEMs start adding it as a standard or preferred option. Based on the CC this may not happen till late 98, but should be realistic for early 99. The tie ratio here should be strong. Jaz is a niche product and one that will sell "X "amount of products. It is not the winner, nor ever will be the one that Zip is. Sales on Jaz 1 were postponed by users due to Jaz 2 announcement ( latest and greatest syndrome ). They do expect Jaz 1 sales to increase once Jaz 2 is out ( cost vs performance syndrome ). Ditto, like many things, it has a place in life. But will die a slow death. Keep in mind it is profitable procuct. ( end of product cycle) Lost revenues due to product delays again......sure would like this problem to be resolved once and for all. 70 million .... would of made us extra profits and we would be going to 15 today instead of lower.!!!!!! K E was straight forward in the CC but still did not let all the information we would like as investors. Therefore many may sense he held back key facts. No doubt one could look into the holes and make many conclusions, good and bad. The bottom line is simple... IOM is not going out of business and is growing. It will be in a lifeless period till tie ratios pick up and or Click makes it. There should be some exciting times during this period when delayed products are finally available or when other companies add IOM to their product line. Invest accordingly and may the force be with you......The above post is one persons opinion ( my safe harbor statement ) Regards, (still long, but will reduce to a manageable level) Tom