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Charles & Colvard Ltd. Message Board

  • pen_stock pen_stock Apr 7, 1999 9:02 AM Flag

    Is this the beginning of the good times?

    From the PR Newswire on Yahoo!

    Rapid
    growth in shipments of moissanite gemstones is expected
    to cause revenue to exceed C3's expectations for
    the
    first quarter of 1999. When the company announced 1998
    operating results in February, the expectations were that
    the
    quarter to quarter sequential growth in carat shipments
    would be more than 25 percent for the first half of
    1999.

    Faster than anticipated increases in production allowed
    the company to ship approximately 40 percent more
    carats in
    the first quarter of 1999 than in the
    fourth quarter of 1998. The company expects quarter to
    quarter sequential growth in
    carat shipments to be
    approximately 20-25 percent for the second quarter of
    1999.

    This sure looks good to me! However, there is always
    some Doubting Thomas in the crowd that points out a
    negative. Comments?

    Not seeing any, this should get
    CTHR moving!

    GO CTHR!! (Finally)

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    • <<Just received annual report. The company
      continues to look good. However, I doubt the business
      judgement of a CEO that would allow that portrait in the
      report.>>

      It's really a clever plus for the company. Since the
      success of C3 is dependent on pushing the boundaries of
      SiC materials engineering more than any other single
      thing, it is reassuring to see that the CEO has the look
      of a lab rat that can bend science and technology to
      his will. :.)

    • Just received annual report. The company continues to look good. However, I doubt the business judgement of a CEO that would allow that portrait in the report.

      Elp

    • C3 at 13 1/2 and falling. If I could pick some more up at 12 I would think I had died and gone to heaven.

    • Recently read on msnbc that this holiday is now bigger than V-day for the jewelry industry.

    • Hi!
      Although I am no longer in the jewelry
      business, I only quit a couple of months ago. My experience
      was that from Thanksgiving to Christmas was the
      heaviest volume for retail, I did approximately 35% of my
      annual business in those 5 weeks. Other significant
      retail times were Valentines Day, Mother's Day and the
      month of May (engagements, weddings, graduations,
      etc.). Hope this is what you wanted to know!

    • The impact of any license that Cree may give to
      Seaman should be small, in my opinion. While, Cree's
      patents allegedly (I say allegedly because I have not
      read Cree's patents) cover the process of making
      silicon carbide, C3's patents pertain to the method of
      making a gemstone with silicon carbide and to the
      gemstone itself. Therefore, any entity with a license from
      Cree can make silicon carbide as long as they don't
      cut it into a gemstone, as claimed in C3's patents.


      In fact, a license to Seaman may actually benefit
      C3. In this regard, Seaman will become a competitor
      to Cree, and C3 may get better prices and/or quality
      from Seaman. I believe that under the terms of the
      supply agreement, C3 may purchase up to 50 % of its
      materials from other suppliers.

      Good luck to all.

    • Which quarters in the jewelry business are
      generally best and which are worst? It will likely be some
      time before this is a factor for C3, since they
      continue to sell everything they can produce, but I am
      curious for the long term view. TIA.

    • I tend not to look at my small holding in CREE
      because I have always considered it a long term prospect.
      Buy it and put it away for the distant future.
      However, it seems to me that some months ago there was
      some worry about CREE having given licenses to produce
      silicon carbide chips to Seamen Corp.. Also, there was
      recently a secondary offering that would give CREE the
      ability to further build its facilities. Perhaps all of
      this will impact CTHR.

      Regardless, it seems to
      me that CTHR is in the early stages of having a
      product with worldwide impact; this will take time to
      grow but should be well worth waiting for.

    • I've asked myself and C3's management the same
      question and I think I've got the answer. First of all you
      have to remember that while C3 is the monopoly
      distributor of moissanite, Cree is the monopoly supplier of
      raw crystals. Each company's desire is to command the
      lion's share of the profit, leaving the other just
      enough to stay in business. The relationship between the
      two companies has to be rigidly defined by contract
      in order for profits to be shared fairly. Obviously
      more crystal growers are going to be needed
      eventually. But instead of simply handing Cree $30 million
      and saying "OK, give us what you want, and if the
      quality is so-so, well, give it to us anyway cause we got
      no where else to go," C3 has tied grower purchases
      to quality improvements. When Cree's product reaches
      a certain quality (yield) then C3 buys more
      growers, yet more quality, more growers, etc. If you think
      about it, that pot of $30 million is the only thing C3
      has that Cree really wants. And they'll get it
      eventually, but only as they improve the quality of their
      product. The sooner they improve yields, the sooner they
      get the money.

      But aren't yields good enough
      now to justify more growers, you ask? After all gross
      margins are at least 30% and a heck of a lot of
      successful business operate at less than that. Well, the
      company is already growing at 25-40% per quarter while
      trying to establish an entirely new product in a very
      competive industry. There may be more danger in trying to
      grow too fast than too slowly. I think patience is the
      key here, and I think long term investors will be
      rewarded handsomely. If the company can be expected to
      make $1.00 per share in earnings next year (and that
      is conservative) and it commands a PE of 40 (again,
      conservative for high growth company), don't you think the
      stock will be selling for $40/share by December?

    • It is my understanding that crystal growth is
      done at CREE with C3 receiving wafers of a certain
      quality and percentage yield...i don't believe there are
      growers at C3..but am not 100% sure of that. Yields I
      understood to be improving dramatically in volume and
      quality...once a few wrinkles were worked out. I recall the 500
      dealer # in US but also got the impression that overseas
      will be even more explosive.

      I did not take
      notes at the meeting...I was more interested in getting
      a feel for the company and management...all factual
      stuff was repeated in conf. call.

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CTHR
1.01-0.02(-1.94%)May 27 4:00 PMEDT