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TranSwitch Corp. Message Board

  • i_train_robots_and_monkeys i_train_robots_and_monkeys Jan 27, 2010 8:31 PM Flag

    A Surreal Flop

    I seem to remember posting last year how the R/S would possibly serve to lower the share price via shorting. Well, the short interest has increased from 15k to 75k shares in six weeks. Couple that with light selling and you get the status quo for TXCC. It takes millions of shares of volume to raise the price, a few thousand to lower. The stock price is simply ridiculous. I also posted last year or so that buying back shares was a far better use of cash than buying CTLM. Sure, the cost synergies looked good, but sales suck... Instead... Cash gone and dilution... Now the company has to sell 2m more shares to operate. With 2010 sales of $60m, TXCC has a P/S of 0.56. Ridiculous. The stock is trading as if it had missed a SEC filing, there were bankruptcy rumors, et al... Pick a poison. TXCC isn't going bankrupt and should at least be worth its sales. That would mean a $2.75 share price. A still ridiculous $0.34 pre R/S price. What the heck! The IP and sales alone should at least warrant a holding pattern near $1 per R/S or close to $8. That is still less than a P/S of three. Regardless, I had stated previously that $5 might be reasonable given the reduced sales. Essentially exactly where TXCC was before more mediocrity set in AGAIN... Sigh...

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    • How SanDisk survived weathering storms of the long tech draught (almost a decade so far) & recession should be a good case study for companies such as TXCC..
      Licensing their patents and bringing in new gadgets such as MP3 players to the consumer market to generate revenue during hard times...
      All TXCC management/BODs could do was to drool & wait for the revenue ramp up from design wins at BT, KT, BSNL etc..
      Too late to undo the damage?

    • Yes - good suggestion. It should have been an imperative from the board, to look at other growing markets in stead of just continuously repeating the BT bs.

    • Soon after the War President was sworn in [2001] Dr. Das & Co. should have allocated all their resources to develop some gadgets to help the War industry.. TASR anyone?

    • i_train_robots_and_monkeys i_train_robots_and_monkeys Jan 29, 2010 5:05 PM Flag

      wsill: "not much of a chance"??? Just a couple months back TXCC was slated for $75m in 2010 sales. It is now closer to $60m or so, but only due to a temporary slowdown... Delays are bad, but it is just delays... What if things reverse? The R/S and Seaside deals were inevitable. Cost synergies with CTLM don't mean squat if your sales take a hit. Das bet big on CTLM thinking TXCC was getting more sales "for free." Sounds good in principle until your sales are affected by the economic slowdown and your cash position was just reduced due to the CTLM deal. I still believe TXCC should have bought back shares, not CTLM, but when your own company's products are in trouble, gotta go buy someone else's... TXCC needs to dump the poison pill and allow larger investors to buy bigger positions in the company... I want to see more insider buying after the quiet period as well. The stock is at $0.19 pre R/S... The BOD better step to the plate...

    • Wonder if we will get the last half hour bounce today.


    • The reason I point at the board is that they operate with impunity and blame the ceo, when it is the board that is responsible to ensure the shareholder's interests.

      Here is the common sense point : when your markets are shot, go after better markets. Mr. Chen thought the telecom market was a good market because he does not know better. Money managers invest other people's money and are MBAs with spreadsheet and finance experience. they have no street sense of what is happening around the company typically and Mr. Chen seems to fall into that category. Yes maybe he moved faster to cut costs. My college going son would do that. So that only means the other directors were much worse. Being marginally better is not a solution.

      The reason I say this is because I know this company, its competitors and the market much better than most shareholders.

    • Even with Chen this company doesn't have much of a chance. The RS and the Seaside deal are a pretty clear indication of that. There will be some good trades here and there but in the end this company is on the fast track to the pinks.

    • Strat. Suppose Chen didn't join the board or even if he was never a shareholder where do you see the company today? I see a company with no chance. How much money was spent of R&D in early to mid 2000's? $300 to $400 million. How much in revenues did that produce. Herb Chen didn't have a single thing to do with that. If anything when he got on the board he probably tried to slow the process of bad R&D down. I don't know Strat every post you point a finger at Mr. Chen, but I think the company was in trouble long before he joined the board.

    • Herb Chen & Co. did a good con job on TXCC investors!

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