Q1 was disappointing - I had thought break-even might be possible. However, 5 million announced and expected to be shipped in q2 very positive, given revenue recognition from quarterly report is as follows:
"Sales revenue is recognized when the earnings process is complete and collection is reasonably assured. The earnings process is generally complete when the product is shipped or received by the customer, depending upon whether the title to the goods, as well as the risks and benefits of ownership are transferred to the customer at point of shipment or point of delivery. Sales to the United States government are recognized when the products are delivered."
SO, if non-fed revenue repeated in q2 from q1, about 3.7 mil, then revenue of around 9 mil likely. Could be lucrative three month hold if any significant weakness tomorrow. I would expect effort to push under four early, to about 3.70/80 level, and then interesting to see if it bounces back. A lot also depends on color of conf call.
Conference call somber re q1 but very positive looking forward. Delay attributed to limited federal funding under continuing budget resolution, with orders stacked up in q2 that had been anticipated in q1. Margins of approximately 70% on 5 million order. Still pushing sales/marketing strategy, with 'very prosperous' prospective pipeline, though few details given. Also response of 'we are aware and board is considering all options' to question re buyback using cash reserve. My takeaway is q2 will return to profitability, perhsps .08 to .10 (my guesstimate) depending on costs etc. Also NOL of $9 million to balance any tax expense. As predicted push under $4.00 has begun, but given likely improvement in coming quarters only reason to sell is taking loss and hoping you can get back in 30 days hence at comparable level. I'm holding.