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Sierra Wireless Inc. Message Board

st067753 43 posts  |  Last Activity: Jul 28, 2015 3:49 PM Member since: Mar 16, 2007
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  • st067753 st067753 Jul 28, 2015 3:49 PM Flag

    Understood August, but you'd have to agree that the guidance for Q3 will be the real news reported on Aug. 6th and for longs, it better be good.

  • An increase of 700K shares short (or Naked Shorts) as the close of 7/15 when MIFI closed at $2.79. I'm sure the activity on Friday, July 17th was some short covering that pushed to a close of $3.09, but with volume of 924K shares, their are still a lot of short positions in place.

    Again, I reiterate my belief that today was the bottom and MIFI moves higher from here.

  • Reply to

    Current status very simple

    by celltechinv Jul 24, 2015 11:54 AM
    st067753 st067753 Jul 24, 2015 3:21 PM Flag

    And, if you add in the 290,400 options he was awarded on 3/16 (Sec Form 4) at a strike price of $4.54, that's a total of 990,400 Options that Alex has been granted with an average exercise price of $6.13 per share. So his triggers are $4.54, $5.00, and $7.50 to start making money on his options.

    I'd say he's aligned.

  • If you look at today's trading, someone tried to sell, short, or naked short MIFI through resistance with trades of 17K and 14K shares. When it didn't drop, they covered 4K and 13K minutes later and then tried again with another 15K sell order with no success in driving MIFI lower.

    Expect MIFI to begin moving higher in the next few hours and from here as we approach earnings. And, although the data is 7 trading days delayed, it will be interesting to see if the Short Interest moved higher as of July 15th when reported at after today's close.

  • Reply to

    MIFI

    by bookerone2000 Jul 21, 2015 10:34 AM
    st067753 st067753 Jul 22, 2015 1:10 PM Flag

    Yahoo doesn't have it. Go to Nasdaq site, look up MIFI quote, and click on SEC Filings on the left. Filing was on 7/20/15.

  • Reply to

    MIFI

    by bookerone2000 Jul 21, 2015 10:34 AM
    st067753 st067753 Jul 22, 2015 12:32 PM Flag

    nad,
    MIFI has been very profitable for me and I hold a different opinion, but I appreciate your view.

    According to the Nasdaq, a slightly lower % is held by Institutional Investors (18.11%), but we'll know more in about a month once they all report. As for tax time, I don't think anyone is thinking about that right now but you, and with over 12,000 $4 Dec call contracts open, MIFI could be very interesting by then.

    As you can see, I don't like the excuses of manipulation any more than you do as I'm trying to evaluate the business and financials. The proxy statement that came out yesterday (still with a date for the meeting being blank) gave us all a much clearer picture of what MIFI will look like moving forward.

    Admittedly, there are some things I didn't like such as the request to increase the outstanding shares to 150M because 97.5M of the current 100M are already outstanding or reserved & the assumed $77.7 in revenue and GAAP EPS loss of $.23c for March 31, 2015 as if MIFI, Feeney, & Digicore were together at the beginning of the year. (MIFI reported a loss of $.17c and DigiCore had a profit so what does that say about Feeney).

    On the + side, MIFI will have close to 600K active billable subs producing recurring monthly revenue, gross margins should continue to climb as Digicore's exceeds 63%, DigiCore's business is showing nice growth (specifically Internationally) while reducing operational costs, Feeney's $38M FY 2015 revenue projection must be weighted toward 2H 2015, approx 50% of the outstanding shares are owned by Insiders including HC2, Karsh, and McGuire, and MIFI should have $45M to $55M in cash once everything is done in Q4.

    My point about MIFI having been profitable for me, I held a large position in the low 2's before I sold half of it when it popped over $6. I bought more in the low 3's and added again last week so I can wait this out as I'm still green. With rev, EPS, and GM growing, I believe I will be rewarded, but time will tell.

    Sentiment: Strong Buy

  • Reply to

    Digicore Acquisition

    by st067753 Jul 13, 2015 8:26 PM
    st067753 st067753 Jul 21, 2015 2:32 PM Flag

    From today's proxy statement:

    According to DigiCore’s publicly available financial statements and the average currency conversion rate for the year ended June 30, 2014, DigiCore reported revenue for its 2014 fiscal year of $86.0 million and earnings before interest, impairments, taxation, depreciation, amortization and capital items (calculated in accordance with IFRS) of $9.5 million. During its 2014 fiscal year, DigiCore’s gross margin exceeded 63% and its recurring revenues accounted for greater than 65% of total revenues.

    Also, if this agreement is terminated, Digicore would be required to pay a termination fee of $800K to Novatel.

  • Reply to

    MIFI

    by bookerone2000 Jul 21, 2015 10:34 AM
    st067753 st067753 Jul 21, 2015 1:09 PM Flag

    I just don't see it as MIFI wouldn't attract many Market Makers as MM's make their money on volume with the Bid/Ask spreads and commission fees for the trades. MIFI doesn't have the daily trading volume that would interest them. As has been said before, for every seller there's a buyer and the market makers would be buying from sellers & selling to buyers as the go between to capture the spread and commission.

    If I understand your claim, you are suggesting that MM's are taking a position themselves in MIFI or trying to drive the price down for an interested buyer at lower levels. MM's are like casinos, they don't gamble themselves as they just take their cut with minimal risk on trading activity. An MM would have had to take a "Naked Short" position to drive down MIFI, thus taking a position themselves and adding risk. Again, I don't see it as I'm sure they'd much rather manage a 1,000,000 share trade with a $.01c spread to collect their $10K + commissions then spend their time with 20,000 shares with even a $.05c spread to collect $1K + commissions as MM's don't typically hold shares for more than a few minutes and definitely not more than a day. Otherwise, they wouldn't be called MM's, they would be called investors.

  • Reply to

    MIFI

    by bookerone2000 Jul 21, 2015 10:34 AM
    st067753 st067753 Jul 21, 2015 11:02 AM Flag

    I agree that MIFI is way undervalued as well, but let's stop with the "traders still playing games" excuse. Verizon's results should have been viewed as positive for MIFI and was most likely the reason for the initial increase this morning. Now, it's up to MIFI to deliver the results as we are trading 50% below even analysts target price of $6.

  • Reply to

    Digicore Acquisition

    by st067753 Jul 13, 2015 8:26 PM
    st067753 st067753 Jul 20, 2015 6:48 PM Flag

    I was of the understanding that this Digicore Acquisition was expected in Q4. I just came across an article stating:

    Nasdaq-listed Novatel said it believed the acquisition, which is expected to be completed in August, “would establish Novatel’s position as a significant player in the global asset tracking and management market, and would provide immediate top-line contribution and meaningful earnings contribution in 2016”.

    I'm trying to confirm, but search "DigiCore changes hands for R1.09bn" to find the article.

  • st067753 st067753 Jul 20, 2015 4:44 PM Flag

    According to the Verizon Wireless website, I see the JetPack USB U620L from Novatel being sold per the press release last week. Went on sale July 16th.

  • I believe Verizon is MIFI's largest and most strategic carrier partner so I will be closely watching the results and guidance tomorrow morning. With the saturation of Smart Phones and Tablets being less popular, the IOT/M2M and Mobile Computing products will be the drivers for any subscriber growth. If VZ beats subscriber growth expectations, that could be a good sign for MIFI as well. If not, then it could be one reason for the most recent downturn.

  • As of the announcement of this acquisition, it was estimated that this purchase of Digicore would be approx. $87M based on currency exchange rate as of 6/18. If you look at the USD/ZAR currency rate history, the ZAR has continually dropped against the USD so I expect that $87M estimate to come down a few million by the time this deal closes in Q4.

    Also, based on my research, Digicore looks like they last reported $18M+ per quarter in revenue which ended December 2014. Their next report will be Jan - June 2015, but those results won't be released until mid-Sept based on reporting history, but $20M to $25M by Q4 should be expected meaning Alex & team is paying about 1X revenue for Digicore. (A good deal for a profitable company)

    So for Alex to hit his $400M annual run rate by the end of the year, that means we should expect the existing business to produce $75M to $80M in revenue in Q4. (Unless Alex buys another company, but I don't expect that to happen)

    If Q2 is $62M to $70M (Mid-point of $66M), we could be looking at $67M to $75M in Q3 (mid-point of $71M) and $72M to $80M in Q4 (mid-point of $76M) with ~$24M from Digicore to meet Alex's $100M target.

    Has anyone done similar research as it relates to Digicore?

  • Reply to

    Q2 Revenue Prediction

    by st067753 Jul 8, 2015 8:53 AM
    st067753 st067753 Jul 8, 2015 7:57 PM Flag

    Understood, but I would think that they would have had to order the inventory in advance before they went on sale.

  • Reply to

    Q2 Revenue Prediction

    by st067753 Jul 8, 2015 8:53 AM
    st067753 st067753 Jul 8, 2015 5:20 PM Flag

    I was pleasantly surprised that my post actually avoided most of the typical rants without warrant or context.

    To jrg8554: I think I'm probably high on my MC number of $49.06M as I know Alex had referenced being at $50M MC & $50 M2M by Q4. Although, MIFI did announce 2 (AT&T & BELL) deals in the quarter, but not 3 which he said would happen last earnings call. I think all MIFI longs are counting on strong guidance for Q3 so it better happen.

    To sejsscarter: I like your assessment especially when looking at the 4 M2M announcements you referenced. I only question how much revenue impact each one will produce. One thing I didn't add in was any potential revenue from the MIFILab as I believe Alex said that some customers are starting to utilize it and he thought $1M to $3M per quarter from the MIFILab was attainable.

    To august: Surprised that you predicted $64M (below the mid-point of guidance), but again you are referencing carrier delays. Bell was announced on 5/19, AT&T was 6/23, and one was missed. Then again, I don't think the future value of MIFI will be based on Mobile Computing. It all about M2M and the recurring revenue it garners so if they announce a number around $64M due to flat or reduced MC numbers & M2M in the Mid 20's. I'm OK with that and believe that will be viewed as a positive.

    To bookerone2000 and long_2020: You added nothing which tells me you're just pumping or bashing with no knowledge or insight.

  • Reply to

    Trading halted????

    by fathertimetoretire Jul 8, 2015 12:19 PM
    st067753 st067753 Jul 8, 2015 4:52 PM Flag

    I agree that Slim's departure has nothing to do with MIFI's recent performance as his new Offer Letter would have taken effect on June 14th and instead Slim resigned with his last day effective on June 11th. His required 30% pay in the form of stock went into effect on March 17th and by resigning, he received 300% of his salary, 300% of his bonus, 12 months of employment services, and 24 months of healthcare for he and his family. If he left after June 14th, he would have received a drastically reduced severance.

    Again, Slim leaving should reflect nothing toward MIFI future performance.

  • Based on the Q1 revenue performance of $53.5M, which consisted of $44.6M in Mobile Computing and $8.9M in M2M (of which $300K came from Feeney), my prediction on the breakdown for Q2 looks like this:

    Alex said Mobile Computing will grow by 20% in 2015 and last quarter MIFI reported that total revenue grew by 10.8% driven by MC. If we take a conservative view of 10% growth in MC, that comes to $49.06M. Add in $9.5M for M2M including 10% growth ($8.6M M2M rev + 10%, not including Feeney). And finally, add in Feeney's number + 10% for another $10.45M. (Based on Feeney's $38M annual revenue projection) The total brings Q2 revenue to $69.01M.

    Even with no growth, total revenue would be $62.7M, which would still be within guidance given. As shown, 10% growth would be at the high end of guidance.

    Do you agree or disagree? Interested in the details behind your views vs. Pumping or Bashing with no added context.

  • Reply to

    MIFI

    by bookerone2000 Jul 7, 2015 9:42 AM
    st067753 st067753 Jul 7, 2015 3:52 PM Flag

    lupo, only in a hostile take over would shareholders really decide on a buyout. Any purchasing entity is going to work with the existing management for interest in selling the company.

    Best of luck to you, but my analysis was giving only the facts of revenue and margin projections as compared to one year ago when Alex and team came into the picture. I'm not saying that MIFI is going to hit these guided metrics, but if they do, MIFI should trade much higher. If they don't, which I'm going to say is the camp you're in, then MIFI is exactly where it should be.

    Like sejsscarter said prior, we should know more in early August and throughout the 2nd half of 2015 when Alex said they would have "several new product launches" that he will be able to talk about in Q3 and show in Q4. On the flip side, Alex did say on the earnings call in May that MIFI would be announcing 3 new products with 3 North American Carriers by the end of June. I've seen the AT&T and Bell product launches, but I'm not seeing the 3rd. Alex might have to answer for the miss on the 3rd.

  • Reply to

    MIFI

    by bookerone2000 Jul 7, 2015 9:42 AM
    st067753 st067753 Jul 7, 2015 1:21 PM Flag

    For someone to buy the company, you have to have a willing seller.

    Remember that a year ago, the new management team valued MIFI at about $9 per share based on a number of items. (see the letter to overthrow Peter L and take over the company) That was when MIFI was doing $37M in revenue and margins were at 11%. They are guiding to $100M in quarterly revenue and margins of 30% by the end of 2015. (Again Q2 is $62M to $70M with margins of 24.5% to 26.5%)

    So, what do you think the current management team values MIFI at today vs. the $9 a year ago? I'm sure it's in the double digits and no ones probably ready to buy them out at those levels today, but you're right, maybe they should. Think about it....$400M in annual revenue at 30% gross margins ($120M) would garner a much higher market cap then the $150M MIFI sits at today.

  • Reply to

    MIFI

    by bookerone2000 Jul 7, 2015 9:42 AM
    st067753 st067753 Jul 7, 2015 10:14 AM Flag

    bookerone, IMO I don't know that I would class less than 100K shares this morning being attributed to manipulation. My take is that since MIFI dropped below $5, there were probably a large number of investors that were required to cover any margin on their accounts. Especially as the overall market has come under pressure.

    The next move on MIFI will be determined on their Q2 earnings and more importantly Q3 guidance. Q3 & Q4 will either make or break MIFI as this has been the expectation set by Alex and team.

    Sentiment: Strong Buy

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