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Technology Stocks : Deswell Industries (DSWL) -- Ignore unavailable to you. Want to Upgrade?

To: j rector who wrote (447)	2/12/1998 12:05:00 PM
From: Ron Bower	Read Replies (1) \| Respond to of 1418

j, I don't understand today's action. As I write this, there's been 9,900 warrants traded. With the holiday Monday, these shares won't clear until the 18th, too late to exercise. Hmmm. I'm going to stick my neck out and post my numbers. Comparing this 3Q to 2Q, I project revenue growth of 10% for Jetcrown and Kwanta, 30% for Kwanasia, and a combined revenue increase of 25% to 22.5M. On this I see $3.7M earnings for a fully diluted .69 EPS. This would bring fully diluted EPS for the last 4Q to $2.18 based on 5.412M outstanding shares. It's 37% earnings growth from last year, 17% growth on reported EPS (non-diluted). For the 4Q I expect virtually no improvement in EPS and some added dilution due to stock options. Forecast full diluted EPS for the fiscal year of $2.37. I have lowered net margin to 16.4% because I see most of the rev increase being due to increased assembly OEM sales of Kwanasia. This will also be impacted by minority interests and will continue thru the 4Q. In the 1Q ending June 30 I see a substantial jump in revs, margin, and earnings after Jetcrown gets the new machines in operation (100% ownership). This may seem a little optimistic, but I reviewed the phone conversations along with the PRs and it's what I come up with. What the market reaction will be I can't begin to predict. For what it's worth and I hope I'm right, Ron

To: j rector who wrote (447)	2/13/1998 11:16:00 AM
From: Ron Bower	Read Replies (2) \| Respond to of 1418

j, ECM sector - Deswell is almost never mentioned when ECM companies are listed? There's only one analyst that issues any coverage and that's minimal. It's too small for the Funds. It's a sleeper, but one of these days..... IMO, for everything that's happened, Deswell has been doing fine. It dropped from 26 to 15, but the entire ECM sector dropped, very few of them Asian based, and none of them with the added situations of the Namtai selloff and warrant call. When the dust settles (next week), we can get to actual values based on the company financials and performance. I don't see any ECMs with better stats. For what it's worth, Ron