glad you asked. ntwk likes to report eps based on average weighted shares not total shares
to lessen the damage dilution does in any given qtr. knowing that, you should always look at
total shares issued on the balance sheet to give you an idea of dilution which already happened
but was not reported as it will hit the next reported qtr. using the actual average weighted shares
already reported for the last 4 qtrs here is how i think everything will unfold. if you notice, 3 months ago
analysts were expecting .35 for the qtr that we just finished for 6/30, but when tailwinds fully converted
their notes their estimates dropped significantly to .25. as a result full current year estimates also
dropped from .94 to .84 and the stock price dropped. (well deserved i might add)
my opinion is as follows if no secondary offerings are done or no shares converted for any new note offering.
i'm just using existing dilution & with estimated additional shares as we all know they pay some bills
with shares every qtr as well as exercise options, warrants & convert to new shares. (see subsequent events from last 10-q)
q4 june .25 eps - net income of 2.2 mill - already reflects significant dilution from .35 to give .84 for year with 8.75 million average shares vs 7.5 mill shares prior yr.
q1 2014 sept - .16 eps - net income of 1.45 mill on 9.0 mill avg shares vs 7.6 mill shares prior yr.
q2 2014 dec - .25 eps - net income of 2.3 mill on 9.3 mill avg shares vs 8.0 mill shares prior yr.
q3 2014 march - .26 eps - net income of 2.5 mill on 9.6 mill avg shares vs 8.4 mill shares prior yr.
q4 2014 june - .27 eps - net income of 2.7 mill on 10.0 mill avg shares vs 8.75 mill shares prior yr
2014 eps of .94 vs .84 for 2013 = eps growth of 12% due to dilution, current price of 10.23 = pe of 11
with a market cap of 102.3 million on 2014 revenue of around 60 million. which reflects i think is fairly valued. if they issue new shares for any reason, game over.