IMO, the SDN strategy will not contribute meaningfully to the financial results of EXTR until late in 2015.
From the revamped website:
"Working at Oclaro
Oclaro: A Bright Future Ahead
It’s an exciting time for optical communications. And we are at the forefront of delivering new innovations that are changing the way we live, work and play. Join us, and be a part of a global team evolving how the world connects."
Wil INVESTING in Oclaro have "A Bright Future Ahead"?
I would not count on Lenovo to buy EXTR. It is not a core high growth business for Lenovo. The misery will likely continue well into 2015. Extreme has had stagnant revenues, very small non-GAAP earnings, large GAAP losses and a tangible book value that is only about 10 cents per share. This is not a recipe for increasing share price. The growth that Berger promised is still 3 quarters away and there is no assurance that it will materialize. The company better delivers on the estimates for this quarter or the stock will be below $4 again.
Oclaro is a money-losing company whose survival is doubtful. OCLR is a speculative dollar stock that would typically lose large percentages when the NASDAQ declines significantly.
The only reason the stock was trading near $9 is because of some mentioning of ATML as a potential takeover candidate, not because it is a "good company" that has significant growth and earnings ahead. Naturally, when the NASDAQ weakens so does the stock of a company like ATML.
In Feb, Berger got 280K shares for free, so the 10K are a token addition to his position. Other officers did not buy. Perhaps they do not think that $5.33 is a gift... Although Zacks has a "strong buy" on EXTR, the stock reacts rather negatively when the NASDAQ market weakens. After today's 6% decline, it is itme for Berger to double down....
Past performance of Harmonic under Harshman is indicative of future performance, regardless of new products. Harshman has to go!
"Also since ore has never gone to 60 [dollar equilivant of 80] for the last 60 years... a 60 dollar price of ore would be just a tad off base. "
You are contradicting yourself. Did!'t you say that iron was $13 in 2000 (which is correct)? Use any constant-dollar calculator and find out that $13 in 2000 is less than $20 in 2014. $60 is quite possible. It was only $33 in 2006.
Goldman Sach's projection is actually optimistic. If one believes that $80 /ton projection, VALE should be accumulated. In Sep 2006, just 8 years ago, the iron ore price was about $33/ton while VALE share price was then about $10.
Let's go back to Sep 2006: the iron ore price was about $33/ton; VALE share price was about $10; the tangible book value of VALE was about $3/sh. Now, it is Sep 2014: the ore price is about $90; the share price is about $13; the tangible book value is about $7. China's ore consumption is the main reason for the meteoric rise of the ore price since 2006. If China's consumption slows down considerably, it is likely that the ore price will get down to $60 but based on the historical valuations of VALE the share price will not drop below $11 because even at $60 VALE will still have positive cash flow.
Not really. Numbers came in-line but outlook came much worse than projected.
"As a result of this decrease in demand for wireless transceivers, as well as a decrease in demand for telecom products due to soft carrier spending and a decrease in demand from several datacom customers with lumpy order patterns, we expect our overall revenues to decline in the second fiscal quarter"
"GAAP gross margin decreased to 30.2% from 31.6% in the preceding quarter, primarily driven by less favorable product mix, primarily the result of increased sales of transceivers that address wireless applications and lower sales of our 100G ethernet transceivers, as well as an increase in depreciation as a result of an increased level of capital expenditures. "
It should not have much influence on Oclaro's stock price. The price is already below the tangible book value (even allowing for the projected loss this quarter) and it already reflects the poor outlook given by Oclaro.
Let's go back to Sep 2006: the iron ore price was about $33/ton; VALE share price was about $10; the tangible book value of VALE was about $3/sh. Now, it is Sep 2014: the ore price is about $90; the share price is about $13; the tangible book value is about $7. So, if the ore price is down to $60, the share price will not drop below $11.
asj1953 • Jul 11, 2014 12:24 PM
By August 31st
TRIB will be 26 pps. Just my gut feeling. Am taking hamburger bets.
duhu12 • Jul 14, 2014 7:30 AM
The general market is ripe for correction. Statistically, September and October have not been kind to the market. VALE will likely join in a selloff. As long as VALE is profitable, its price will not drop much below its declared book value of $12.6. Because it is a Brazilian stock, it will be discounted. The most bearish analyst (the one that projects weakness in iron ore prices for the next 3 years) would not buy VALE above $10.5. I do not think it will get below $12, and I would accumulate below $13.
The general market is ripe for correction. Statistically, September and October have not been kind to the market. VALE will likely join in a selloff. As long as VALE is profitable, its price will not drop much below its declared book value of $12.6. Because it is a Brazilian stock, it will be discounted. The most bearish analyst (the one that projects weakness in iron ore prices for the next 3 years) would not buy VALE above $10.5. I do not think it will get below $12.
Seaborne iron ore prices hit a five-year low Wednesday, with the Platts 62% Fe Iron Ore Index falling 75 cents on the day to $88/dry mt CFR North China.
The last time the 62% Fe IODEX was lower was July 21, 2009, when it was assessed at $87.50/dmt CFR North China.
With end-user buying continuing to ebb as Chinese mills steered clear of spot commitment, spooked by bearish steel fundamentals and a general lack of market confidence, bids pulled back from existing offer levels, resulting in significantly lower trades.
Sources said further falls were to be expected in the longer term because the market has clearly flipped to a buyers' one.
"We've all gotten used to having very low iron ore stocks and only buying if and when we have a specific steelmaking need to fill," a Hebei-based steelmaker said. "There's no such thing as buying extra material to stock up."
The steelmaker added that another factor was the common knowledge that there was a lot of available material around, both in the seaborne and port stock markets.
Additionally, a historical low showing in iron ore futures on the Dalian Commodity Exchange Wednesday dealt a big blow to buy-side confidence, sources said.
The most actively traded January contract for DCE ore futures closed at Yuan 637/mt ($103.25/mt), down Yuan 11 from Tuesday, and settled at Yuan 642/mt, down Yuan 4.
"A lot of market players are looking at the DCE iron ore futures now because of the sheer amount of trading liquidity so it has a huge impact on sentiment," a mill source in Hunan said.
"We've all been holding back and subsisting on long-term contractual material as much as we can, but this is definitely hitting our confidence hard."
So a company that just a couple of years ago boasted as having achieved critical mass and diversification for success has been dismantled and shrunk to be fully dependent solely on 100G -related products. Any hiccup in execution or cutthroat competition from its larger and more diversified competitors and Oclaro will be driven out of business. A year ago, management said they would reach breakeven EBITDA by the end of 2014 with $110M / quarter. Now it promises breakeven EBITDA by Sep 2015 with $100M / quarter. Hurray!
No, it is not a dog. For the stock to move beyond its recent peak, it will have to exceed estimates or initate dividends. This stock has ample cash flow to initiate a 4% dividend. Flextronics has been repurchasing its own stock as a way to return capital to its shareholders while increasing EPS on a lower share count. As the share price rose beyond $9, that activity has slowed down considerably. Eventually the share repurchasing will serve only to compensate for the very lavish stock awards the management of FLEX gets.
It climbs slowly with the general market but not by virtue of its own strength. The stock is below the peak it reached prior to the weak guidance given in the last earnings call.