Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: s. bateh who wrote (50307)	3/16/1998 9:41:00 PM
From: Cogito	Read Replies (1) \| Respond to of 58324

S.B. - Thanks for clearing up a misunderstanding of mine. - Allen

To: s. bateh who wrote (50307)	3/16/1998 9:46:00 PM
From: Rational	Respond to of 58324

Your post makes a lot of sense to me. The management is "overreacting" to the law suits (for the company not giving timely warnings) and the stock market is falling into a trap. Or, the management is playing a different game this time: Reverse Game: Give excessive negative news to make the price drop while insiders buy -- the exact opposite of what they did while selling when IOM was at its high. Remember, there are no class action law suits by investors who missed the opportunity of a positive return on investment. Managements of big and established companies (GE, Coca Cola, IBM, and so on) are matured enough to play the reverse game and face no class-action law suits (generally). IOM is becoming a matured company. Their January warnings let many insiders buy at $8 (it was reported in some news posted in Yahoo! thread). The other insiders (KE included) who could not buy then and saw the price rise would now get a new opportunity. Obviously, I do not know if this game is being played by IOM executives. But, it makes sense to play so, consistent with your calculations on backlogs. Remember, the market is very surprising (driven by greed)!! IMHO, one should not get duped one way or the other. KE is also here in the market to make his bucks!! There is no better way than to make it through own stock, given that you can control the timing of information release. KE does not seem to be an idiot. [This is not for buy/sell/short/hold advice, though.]

To: s. bateh who wrote (50307)	3/17/1998 10:53:00 AM
From: Bill Lin	Read Replies (1) \| Respond to of 58324

Hi s. batch! I enjoy your informative posts on the ingram stock levels. if you missed my post before, IOM may have done a linear extention of its quarterly sales. With 12 weeks in this quarter ending march 28 1998, that is $30 million in sales per week to match their Q1 '97 revenue level of $360 million. To break even with their estimated SGA spending of $110 million (up from Q4 spending of $104 mm), and R&D spending of $25 mm (up from Q4 spending of 24mm), or total op ex of $135 million, Iomega must make a gross margin on sales of 30% (down from 33% Q4). So the calculation is as follows: $135mm in expenses / gross margin = breakeven point. $135/0.3 = $450 million. Assumming Iomega projected a linear sales quarter...They have $300million in sales so far this quarter (2 weeks left), and need to sell $150 million in the next 2 weeks to recover to break even. If they sell 100,000 jaz 2 drives at $400 wholesale, that is equivalent to $40 million. If they sell 100,000 jaz 1 drives at $200 wholesale, thats $20 million. So somehow in the next 2 weeks, they need to sell $90 million in zip/zipdisk/jaz1 disk/jaz2 disk. If ingram does represent 10% of iomega sales, as it seems, your reports will give a good indication of how iomega does in the next 2 weeks! Thanks for all your info. BL