SOYO $ 0.94 will Report Record Earnings on 3/31/08...Will launch Honeywell LCD HDTVs in 2008
Target: $5+ in 2009
- Investment Highlights:
- SOYO is trading at a very low 10 PE and 0.4 P/S for a company growing profitably at a rate exceeding 40%/year.
- SOYO, a US-based LCD HDTV maker, will report about $105M revenues and $4M net income for 2007 on 3/31/08. This corresponds to almost 100% growth from 2006 (info per February 2008 presentation).
- The company will guide for at least $140M revenues and at least $5M net income in 2008 per recent update.
- SOYO is still in discussions to increase its credit limit. Should the company increase its borrowing power from the current $20M to the $50M it is seeking it would increase revenues to about $240M and net income to about $7M.
- The company says that it is gaining market share from Tier 1 LCD HDTV manufacturers because it offers a better price/quality/size-range line up for budget-minded buyers in the current economic environment.
- In 2007 SOYO entered into an exclusive long-term license agreement with Honeywell to manufacture LCD HDTVs and a full line of consumer electronic products bearing the Honeywell brand name.
- SOYO introduced the Honeywell LCD HDTV line-up at this year's CES show. These premium HDTVs range from 47" - to 82."
- SOYO will launch the Honeywell LCD HDTVs in the 3rd or 4th Quarter of 2008 per company comments. More clarity about this on Monday's earnings release/CC
- SOYO is well positioned to take advantage of the conversion to all-digital broadcasting scheduled for February 2009. SOYO's least expensive, well-reviewed LCD HDTVs start in the low $400's.
- SOYO, established in 1989, has recently applied for listing in the AMEX exchange. Once there it is likely that it will quickly move up to reflect fair value of about $3 even before the "Honeywell Factor"
- SOYO's market cap is only $44M with insiders and institutions owning more than 50% of the company. SOYO's float is less than 20M shares.
On March 18, 2008 SOYO CEO Ming Chok said:
.."I wanted to announce these projections sooner, ...but we are still working on extending our bank financing..."
.." Our biggest limitation as a Company has been that we have grown so quickly that we reached our maximum credit lines for buying products from our suppliers. We are still working on new credit facilities, but regardless of whether or not we can expand our credit, I am confident that we can reach $140,000,000 in revenues and earn a net profit of $5,000,000 in 2008"
This is the initial Honeywell line that SOYO plans to launch this year:
- Honeywell Altura™ LCD full HD TV’s with sizes ranging from 42” to 82”
- Honeywell Arius™ LCD Monitors from 19” to 24”
- Honeywell SecuraDrive™1.8 inch Portable Storage in 80GB to 160GB Capacities
- Honeywell Airlite™ 700 Bluetooth Headsets
SOYO's Prive line is made exclusively for WalMart Canada where sales have increased from $0 in 2006, to over $20M in 2007 and will increase by another 100% in 2008.
The SOYO brand LCD HDTVs range from 26" to 47" and are sold in the US, Canada, and Latin America. This product line is growing at double-digit rates.
SOYO is an attractive acquisition candidate for those companies trying to enter the budget LCD HDTV space. Furthermore, the long-term license with Honeywell would be an added attraction for any of the companies being sued by Honeywell for the unauthorized use Honeywell's anti-flicker technology for HDTVs.
SOYO products are sold under the SOYO, Dragon, Onyx, Dymond, Honeywell, Le Vèllo, and Privè brand names. In the US you can buy SOYO products at Office Max, Fry’s, Costco, eCost, Amazon, and others. In Canada SOYO products are sold at WalMart, Sam’s Club, Office Depot and others. In Latin America they sell products at over a dozen of well know companies