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Technology Stocks : Macromedia...making a comeback? -- Ignore unavailable to you. Want to Upgrade?

To: Punko who wrote (2286)	7/22/1998 10:23:00 PM
From: av ram	Respond to of 2675

Well Punko things are way different now (than they were in 1996). That time MACR was in downslide due to: - Their inability to introduce new products - Existing products were in the last cycle - Apple was doing bad - There was neither any web related products nor there was any internet strategy. - They had high expenses - Low gross margins Since then MACR has reborn (to say at least). Management has been changed. As we all know that the products that created since then are simply the best and totally innovative for the web. Luckily they executed their internet strategy quite well. And now their web related products are hot cake. Look at the traffic in Dreamweaver and Fireworks user groups. This new MACR is here to stay for long and with quite a weight. I was worried in 96 selloff but I am not today!!! Lets all see what earnings do they bring to the table! As for my prediction, I have already posted following: (and this does not include earnings from Shockrave which I think might be in one million range) "If we safely assume at least 5% sequential growth from the Q4, we get revenue close to $31.5 mil. I expect some operating expenses to go up slightly by (higher marketing sales but less R&D costs) about 3% which gives us close to $27 mil. This gives us income of $4.5 mil (pre-tax). Adding "other income" of $1.5 mil (same as Q4) we get close to $6.0 mil of pre-tax income. In Q4 they used 36% tax rate which gives us net income of $3.8 mil and translating to diluted income of $0.90. (assuming 41.329 mil shares) I have not used any of $7 mil received (or likely to be received) from Apple. Lets see how much royalty income MACR derive from Apple. Few other things to notice: - In fiscal 1998, MACR had 51% revenue from North America. I think this should increase this time. - Although Mac related dependency has reduced to 46%, I think Q1 should see very good sales from Mac Overall IMO, numbers should be pretty decent."