A class action law firm is currently investigating whether Brooks Automation's top executives have backdated their stock option grants. Backdating occurs when executives backdate their options to an earlier, more advantageous price � rather than paying the market price for the option on the day it is issued. Arthur Levitt, former head of the SEC, has stated that backdating "represent the ultimate in greed. It is stealing, in effect. It is ripping off shareholders in an unconsciousable way."
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Put my money where my mouth is and bought some BRKS today.
A bad day on Wall Street coupled with a downgrade really axed BRKS today. I can imagine the downgrade: "we are concerned about slowing order growth in the second half of 2006." I also own NVLS, which received an upgrade today and closed green. I can imagine the upgrade too: "we think concerns about slowing order growth in the second half of 2006 are overly discounted and contend that NVLS' valuation is extremely attractive."
Someday people will wake up to BRKS having $2.65 net cash in the bank and an annual earnings power of $1.00 per share, and they'll say "that's cheap, I'm buying." That's how I'll make my money.
HELX used to supply components and subassemblies to AMAT. (Now with HELX purchased by BRKS, another company has already taken the HELX ticker symbol!) They were particularly strong in supplying CTI cryopumps to AMAT and others (they were the cryopump market leader), not so strong with Granville-Phillips vacuum gauges and similar components.
Sometimes an ultimate customer (like INTC or TSM) would specify that AMAT (or another OEM) use HELX components on specific tools because these could be remote-monitored using the "True Blue" customer service system. BRKS hopes to transfer this customer "stickiness" to its other hardware lines by incorporating the remote-monitoring capability into their other hardware.
I won't bother arguing the detail of the case with you, the market will decide who is right or wrong. bleorg2003 made some excellent and valid points. No new products relates to the fact that, to my knowledge, Brooks has not internally developed and released any new software products in the last couple of years and the status of many existing products might be considered by some outside observers to be 'ill defined'?
Asking why the software division wasn't sold or spun off might not be the right question, try asking who would want to buy it?
The skilled jobs, and more importantly the expertise, lost were and are important to America overall but that can't be undone either. I will state that prior to being taken over by Brooks certain software groupings were highly profitable......
Sorry about not being clear. I didn't mean underperformed in the sense of a personnel evaluation.
As far as why BRKS didn't spin off or sell the software division, I don't know, but could imagine certain people not liking the implication that they should never have bought into it in the first place. Interestingly, two of the people who might be inclined to defend past decisions were removed from the Board of Directors this month.
I guess I misunderstood what you meant by under-performed.
Not a whole lot of plants being built. The venture into discrete manufacturing was a good idea but they never made the effort to get it to the customers that really needed it. The venture into the medical industry looks good on paper but in reality it's a lost cause and will just open the company up to more lawsuits if the product fails.
Either way you size it up it's a lost cause. What BRKS should do is completely spin off or sell the software division and stay focused on hardware. They always were a hardware company. Software folks were always treated like second class citizens there. I'll never understand that.
Even though you took all the umbrage, I'm glad you left a little laughter for me. I'm laughing at you because you seem to be arguing with the guy I'm arguing with. And wondering, did this guy check his code better than he checks his posts?
"No new products" is his statement, not mine.
With respect to software, my contention is that management led BRKS software into niches and vertical industries where they could not compete profitably. And so they underperformed (underperformed means "lost money", which is the bottom line in business if not amongst programmers). Everything you said in your post regarding commoditization of a software niche staffed by overly expensive people supports my contention. Thank you for your support.
I stand by my summary statement with respect to software: "Too bad you lost your job in BRKS software, but from my perspective its better for the company and investors in the long run." And I stand by my thesis that such actions increase BRKS' leverage to revenue increases. I remain glad management is taking actions to reduce their breakeven sales level and increase leverage to revenue increases.
I take umbrage with that statement, sir and yes, I will take all the umbrage and I'll be damned if I leave any for anyone else.
The jobs lost in Brooks software were not because they were "under performing". You sir, are an idiot for all, who really know what happened, to see. We're sitting back and laughing at you for the vast sweeping generalization you just laid down.
Those jobs were lost because they were shipped over-seas to Korea and India to "bring down costs". The organizations size couldn't match what was being sold. Period. End of story. It had nothing to do with performance. Many very good people were let go, people that were and remain the very best in the industry, for no other reason than they were too expensive. There are very few people in the entire world who know MES. It's some of the most complex software in existence. The people who develop and support it are of the highest caliber in the software industry and nobody did it better than the people at <cough> and <cough> that were absorbed into BRKS. The people overseas who now develop and support it are damn good too, and nothing should be said against them.
The fact is that MES software has been commoditized. All the competition in the market is put out by sweatshops in Asia or by IBM who can throw money and people at every problem. There was no deadwood in that division, absolutely none and your little quip about performance reeks of feces. It's a study in bovine scatology.
No new products? You don't know you're talking about. Zip. Nada. Zilch. Absolute zero.
No bitterness here, sweetheart. Trust me on that one. I wouldn't be where I am today without them. I defend nobody, I simply tell the truth because it needs to be told. Armchair anal-ysts are worthless.
"Leverage" refers to the ability to a company to take a large percentage of additional sales to the bottom line once fixed costs are covered. It is illustrated by the increase in profits in Q2FY06 over Q1FY06 resulting from the increased sales volume. Leverage does not refer to the ability of a hardware vendor to become a software vendor in every field they've ever heard of. Thankfully, management has stopped that initiative. Those "massive layoffs" of underperforming software staff lowered the breakeven point at which fixed costs are covered, increasing leverage.
Too bad you lost your job in BRKS software, but from my perspective its better for the company and investors in the long run.
I certainly ain't paid to bash Brooks, i am a former employee so in a 'privileged' position of knowing way too much about what goes on there.
So my question to you, given all this 'leverage' that the might of Brooks has, you'd have thought it would have completely cleared up in semiconductor software.... Why no new products, massive layoffs in development and consulting staff and apparently no vision, roadmap or even vague hints of its direction.
If what I hear of goings on in the other divisions, it's the same story everywhere.... What was Helix is as doomed as PRI and all the other companies 'absorbed' by Brooks....
While its true I know much more about HELX than BRKS, I fully understand the semiconductor capital equipment market, the leverage to increased revenues that BRKS has, the impact of using HELX's customer service model to fuel revenues during the downcycle, the negligible long-term impact of scandals like this, and the uselessness of paid bashers.
Wave bye-bye to your employer's money...!