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TranSwitch Corp. Message Board

  • callclairegreen callclairegreen Jul 31, 2010 6:47 PM Flag

    I Was Wrong

    I thought with all the good announcements that revenues would increase dramatically, but from listening to the cc for the second time, that is not so. Revenues will be somewhat similar $13.5 to $14.5 vs. $14.1 but Opex will be up to $7.1 from $6.6 due to more R&D expenses. It could easily be a losing quarter. Dr. Ali and Bosi guided toward Q4 as the place where the real improvement will come with ramps of higher margin new products and increased revenue. As far as revenue is concerned, Ali said that he expected an average of 20% increases per year over the next five years. Unless something dramatic happens, I don't see this stock appreciating much unless analysts chip in with "buys". In the transcript at the conclusion of his remarks, Ali said "I remain optimistic for the long term prospects for the company - the long term prospects of the company". My expectations for the next six months have been significantly reduced.

    Ochs

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    • "Are you looking to get out completely?"

      No, not in the near future since I still have shares at a higher price. I also always keep some for the really unexpected up ticks. I learned that years back from trading RBAK prior to it going Chapter 11. It plummeted and I picked some up on the way down. It came back with a vengeance but I sold to early at a minimal loss.

    • kpb,

      Just call me the contrarian indicator. I am not pessimistic about the Switch's prospects, I just pushed my expectation out a little bit.

      Ochs

    • Alright, Maybe I should get pessimistic too!

      I don't think we're heading to $ 3 any time soon, especially not this week!

      KPB

    • Maybe, on this good volume, TXCC has it's "usual" jump towards the end and we'll be at 2,80 at the end of this day.

      BTW, Ochs, Your pessimism works out great on the pps, so keep it up! (Especially because your optimism - that I fully shared - just lead to lower and lower pps)

      KPB

    • I remember it traded at almost 80 cents before r/s, at a time when things didn't look as good as they do now. On the contrary, at that time, we were heading from one bad CC to another worse CC.

      So plenty of room and today should be just a start to get back at recent levels of 3,40. If it stays like that and the overall market will not go in a 2nd dip, we could be at those 80 cents before r/s at the end of this year!

      (80 cents somehow does sound less impossible than 6,40)

      KPB

    • Xaz168. Here is the slide presentation from the annual meeting. http://www.transwitch.com/investors/documents/2010_ShareHolder_meeting_V1.pdf Ali is targeting an addressable market of 2B. This isn’t happening tomorrow but I imagine they are in the process of building a 5 year plan. They main problem with the old TXCC is they spent money on R&D that really didn't get any market share. 2% here 3% there. Ali isn't going to commit any resources to products like these. If you have listened to him talk he has spent plenty of time talking to his customers and his employees to find out where TXCC"s technology’s are different, and where they are the same as competitors. He is only going to target areas where they are different which should result in much better market share and margins. The other thing to keep in mind is that Ali isn't going to talk much about what is happening,{design wins} he is just going to let us shareholders know when it actually produces something for the company. It is important to understand that the fruits of Ali's labor won't really be seen until mid or late 2011. I still feel the stock has plenty of room to grow before that because it is undervalued at this point for many reasons. Last year TXCC was losing money, dealing with balance sheet issues and lost all credibility with the street. Ali and company have been tackling each of these issues one by one. If the stock traded for $4 or $5 dollars it would still be valued at less then 2 X sales. There is plenty of room for growth just for doing things the right way and for being focused on the right areas.

    • wsill,

      I'm thinking at least a year before I sell and could be longer. Are you looking to get out completely? I remember you were pretty discouraged a little while ago.

      Ochs

    • "I do like today's action in the Switch, though."

      The action today is nice. The hard part will be deciding when to sell those purchased at a lower price. I'm looking for the breakout day, perhaps close to 1 million traded.

    • double digit market share...10% of 2B?

    • mrchubby,

      Actually, my gaffe is even worse than I thought, as I meant the comment for the Oclaro board. I do like today's action in the Switch, though. It is great to see it over the rights offering price.

      Ochs

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