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.

Technology Stocks : THQ,Inc. (THQI) -- Ignore unavailable to you. Want to Upgrade?

To: gofrank150 who wrote (7258)	7/25/1998 3:13:00 PM
From: Harry	Respond to of 14266

More on WCW, Inland, and THQ... headline.gamespot.com Harry

To: gofrank150 who wrote (7258)	7/27/1998 2:06:00 AM
From: Todd D. Wiener	Read Replies (1) \| Respond to of 14266

Chris- I have BASS Masters Classic shipping 100,000 units in Q3 I don't think THQ is currently shipping NWO. I speculate that shipments took place early in Q2, and that the re-release won't come out until the retail inventory is low. This could be in a month or so. Even if THQ does cut the prices (which doesn't need to happen, because the retailers bought the product at $40-45 knowing they could sell it for >$60), THQ's recently beefed-up reserves will absorb any effect. THQ keeps such close tabs on inventory at retailers, that there shouldn't be significant amounts of units in the channel. crysball- Thanks for the good word. Looking at the cash flow statement, one can identify the accrued returns and allowances. I believe that these are indicative of actual charges the company has taken for accomodating retailers and other markdowns. One reason that the reserves balance has increased in the past few quarters is that the accrued returns balance has increased. As long as THQ's reserves balance continues to be greater than actual returns/discounts/etc., the reported earnings won't be affected adversely. In another note, THQ's becoming increasingly conservative with the receivables reserves. In Q4, total reserves against receivables were about 20%. In Q1, they were close to 30%. In Q2, they were 40% of gross receivables. Product sales mix for Q3: 15% PC 24% PSX 49% N64 12% GB Bill- Assuming I'm correct that THQI will reach pre-split levels of $55 by year-end, I think a 3:2 split allows THQ to announce another 3:2 split in conjunction with their full year 1998 results in 2/99. By using 3:2 splits, rather than 2:1 splits, the company is able to increase the frequency of splits, which should be good psychologically. That's my guess. Todd