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Technology Stocks : AULT: The unnoticed superstar -- Ignore unavailable to you. Want to Upgrade?

To: Lord Data who wrote (272)	8/22/1998 11:36:00 AM
From: Clarksterh	Read Replies (1) \| Respond to of 369

Looks like the cable modem market is starting to take off: biz.yahoo.com MINNEAPOLIS--(BUSINESS WIRE)--Aug. 18, 1998--Ault Inc. announced today that they have received a $1M order for power supplies from one of the leading suppliers worldwide in the cable modem industry. This customer, one of the top providers of telecommunications/data transmission hardware, has issued a purchase order for more than 60,000 units to be shipped over the next three to four months. This is part of a series of orders Ault is receiving to support the acceleration of the cable modem business. ''We are very pleased with the continued ramp-up in the cable modem industry,'' explained Greg Harris, Ault's Vice President of Business Development. ''The infrastructure is in-place and our customers are now starting to schedule delivery to the home user in the cable modem market. We believe we are well-positioned in the industry since we are partnered with three of the top four cable modem developers.'' exchange2000.com is a compendium of other stories on cable modem growth. Reverse engineering a quarterly growth rate from the data in these articles, it looks like it is growing between 35 and 55% per quarter. Given that I would expect Motorola, the biggest supplier, should ship about 120 thousand modems this quarter and 170 next. If you assume that Ault is getting 1/2 of the orders (Mot probably has a second source) and that the other two customers total to about the same size, then I would expect Ault to ship about 170 thousand cable modem power supplies in the last Q of this year. At $17 per that equates to somewhere between 2 and 3 million in revenues, or about $1.5M more than they shipped last quarter. And, as switched power supplies, they are higher margin. Assuming 35%(?) gross margins that equates to an additional EPS of 0.075 per quarter. Not too bad for a stock at $4.00. Clark PS On the downside, this next quarter is seasonally weak, so I wouldn't expect much in the way of earnings. Probably around break even.