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

To: s. bateh who wrote (52799)	4/16/1998 10:29:00 PM
From: Jock Hutchinson	Read Replies (1) \| Respond to of 58324

Bateh: You don't have a clue as to what the 50 % OEM figure means. It clearly wasn't a positive to the bottom line. To the contrary it was a detriment. What the 50% referred to was this: Of the total Zip drives marketed, 50% were OEM rather than the previous percentage of 35%.The problem is that OEM Zips are cheaper. And the margins are lower. Moreover, there was no overall increase in Zip drives sold. CC revealed an ugly problem with inventory-"a 110 million dollar bubble" Company called inventory problem critical. Company didn't even know of advertising results yet. SG&A was a disgrace--way too high. Told H&Q they may have to take pricing actions. This was sad--CFO didn't even know if prototype of Click was being shipped. How ugly does it get? IOM is going to be CASH FLOW NEGATIVE FOR THE YEAR. Now my question is how do you evaluate this company's stock price, given that there is no prospect for any real profit for the year, a negative cash flow outlook, a huge inventory problem, increasing competition, a two front war in litigation, and a refusal to provide guidance for even next quarter revenue to all of five analysts covering the company? Oops! There it is again--the old credibility problem. The new team is happy to give a profitable outlook for three quarters out, but the same guy won't provide guidance on next quarter's revenue and doesen't know if Click prototypes have been shipped. Improved quality? They have just begun Six Sigma. That's a long way to go. IOM may have some cachet for the contumascious determination of its investors, but applying standard pricing measures that are used with other disk drive makers when they are at down cycle, its a five buck stock--at best.