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Cray Inc. Message Board

zippybalto 10 posts  |  Last Activity: Feb 4, 2016 12:00 PM Member since: Oct 14, 2011
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  • Reply to

    Good deal for CSCD and FORM Napkin Math

    by petrofornow Feb 4, 2016 11:42 AM
    zippybalto zippybalto Feb 4, 2016 12:00 PM Flag

    More from the announcement and conference call:
    2015 Actual (FORM alone) vs. 2015 Pro-Forma (FORM + CSCD) guidance:
    Revenue $282m $486m
    Non-GAAP GMar 35% 42%
    Non-GAAP OMar 8% 12%
    Non-GAAP EPS $0.37 $0.65
    EBITDA Margin 11% 15%

    That's right: just putting the two companies together would mean FORM having $0.65 in 2015 EPS instead of the $0.37 they reported. And that's just financial synergies, never mind product and sales synergies in years 2, 3, 4, etc. Pre-Deal, FORM's 2016 EPS estimate is $0.48. That means post deal it's more likely to be around $0.80...for a $6.75 stock for a company that will dominate this space.

    It's bizarre that FORM is down, given that just completing the merger alone yields so much cost and tax synergy. Stupid algo traders reacting to the news and not even bothering to see the accretion.

    ZB

  • Reply to

    Here comes the "take-under"

    by zippybalto Jan 21, 2016 5:36 PM
    zippybalto zippybalto Jan 21, 2016 11:00 PM Flag

    So J&J or Bayer will pay $10/share just to make some convert holders happy? Fully diluted, it only represents about 15% of equity so they aren't exactly in a position to dictate terms, are they? And if we followed your logic, the public price wouldn't ever drop below $10.64 ???

    Credit Suisse thinks the NPV of all Horizant revenue 'till the end of time is $10/share. With no expense for, you know, salespeople and marketing and legal. Expenses that currently overwhelm revenues and cause the company to burn prodigious amounts of cash.

    Did you know there are a lot of generics for RLS already? And that that makes it hard for patients to get re-imbursed for the brand name? This, before they've really even rolled out the marketing.

    This 'leak' by the 'unnamed source' is just the usual Kabuki theater by the bankers to ensure that everyone knew XNPT was for sale.

    The writing is on the wall and this is the end game. Send out a term sheet to the possible suitors, beat the bushes to cover your investment banking #$%$ and hope somebody offers a cash deal the institutional shareholders can stomach.

    ZB

  • Will probably be a "take-under." Not the exit biopharma start-ups hope for. XNPT hemorrhaging cash. Nobody wants to fund another public financing round so management is cutting its losses. Credit Suisse just initiated coverage with an "underperform" yesterday. Hmmm., I wonder who tipped off the reporter that the XNPT was "exploring" a sale?

    ZB

  • Reply to

    this could be a $1,000 stock

    by byronangel Dec 10, 2015 12:00 PM
    zippybalto zippybalto Dec 10, 2015 3:52 PM Flag

    A typical Walmart superstore has 150,00 SKUs. At $50/bar code/year that's...wait for it...$7.5 million/year. DMRC does about $25 million in revenue right now. So that's only a 30% one-time bump in revenue. And since that money would be paid by the vendors, those vendors wouldn't have to pay DMRC anything beyond that to sell those same SKUs through Target or Walgreens or Amazon. And no more money to DMRC whether the bar code is used for inventory replenishment or check-out or wherever. The price is per SKU, not application.

    Oh, and the Procter and Gambles and Unilevers and Coca-Colas of the world wouldn't be paying full price...they'd be paying a lot less per SKU for enterprise licenses. So that $50/year would probably average out to $25/year. And that's only as long as the patents last, which since they've been at this for 20 years, is not much longer.

    Interesting fact: no bar code technology has ever become widely adopted while the patents were still valid. Hell, the people who invented QR Codes got a patent but didn't even charge for their use.

    C'mon: just 'cause you're in a cult doesn't mean you've lost the ability to reason! OK, yes it has but just try to think, people.

    (Oh, and yeah, I watched and listened to the presentation this morning. Nothing new under the sun, really.)

    ZB

  • zippybalto by zippybalto Dec 10, 2015 9:42 AM Flag

    Notice: did any money change hands? Yes: Digimarc no doubt paid Rockfish to include this software in their application. What does that say about the value of Digimarc's product? It says it isn't worth very much.

    Lots of discussion about "Wal-Mart" but tellingly, nobody from Wal-Mart is quoted in the news release. Just the brand name thrown around for effect.

    Those of you new to the DMRC story probably don't realize that DMRC has been doing this for 15 years: trying unsuccessfully to log-roll others (retailers, manufacturers, investors, etc.) with news releases and breathless announcements at trade shows and investor conferences...that inevitably are conveniently forgotten when no money rolls in.

    Am I short DMRC? You bet. Have I done a lot of work on this company and their technology? You bet. Could I be wrong? You bet. But DMRC failing to convert its technology into revenue, let alone positive cash flow, is about the surest bet in the stock market. Has been until now, probably will be as long as DMRC keeps finding saps to fund the next news release-worthy boondoggle.

    ZB

  • Reply to

    Censoring Again

    by flipajig42 Dec 3, 2015 12:59 PM
    zippybalto zippybalto Dec 3, 2015 3:45 PM Flag

    Google "Smart Label" "New York Times" and read the first item in the search results.

    ZB

  • zippybalto by zippybalto Dec 3, 2015 11:45 AM Flag

    Oops! Food companies are going with QR codes for Smart Label

    And the Greenies are not happy - they want actual printing on packages so non-smart phone owners can read about possible GMOs. Which means it's a choice between QRs and plain English.

    No mention of DMRC's invisible codes.

    What a shame for all of you in the Digimarc cult. Why don't you form a circle and sing a happy song to cheer yourselves up? That's the spirit!

    ZB

  • zippybalto zippybalto Nov 24, 2015 3:45 PM Flag

    Yup, I think you're right: anyone looking at KBIO right now is getting nervous: $20/share, down 50% today. But hey, at least KBIO has pricing power; DMRC doesn't. DMRC's customers are the federal government, which isn't in the habit of letting vendors charge premium prices and supermarket chains, whose profit margins are generally 1-2%. So I don't think Martin Shkreli has Bruce Davis on speed dial...

    ZB

  • Reply to

    Ready For Another Attack?

    by flipajig42 Nov 23, 2015 7:41 PM
    zippybalto zippybalto Nov 23, 2015 9:40 PM Flag

    Yup, it's business as usual for DMRC:
    Management already guiding for $4m in negative FCF for next year;
    Issuing shares in private sales instead of buying back stock;
    Their earliest core patents began expiring in 2012...but it doesn't matter because they licensed about 3/4 of their patents to IV for money that's long gone.
    Management still singing the same tune since they went public: the future is just one big contract away. And a fresh batch of suckers drawn in every year to pay for the dream (and Bruce Davis's $1.7m pay package)...

    Good luck with that!

    ZB

  • Reply to

    " ummmm boss...i think you need to get in here"

    by mrs_schit Nov 23, 2015 1:35 PM
    zippybalto zippybalto Nov 23, 2015 2:42 PM Flag

    "Knock it down?"

    Uh, Digimarc is hemorrhaging cash, analysts are lowering their loss-per-share estimates (again) and the stock trades at 9 times revenue.

    Digimarc is doing just fine knocking itself down. I think you're assigning way too much influence to the short sellers. It's going up on basically no volume, meaning nobody, even bulls, are jumping on board. When this goes up on the back of major volume, then maybe I'll be interested.

    ZB

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