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URL:  http://boards.fool.com/hey-jim-thanks-for-the-reply-and-your-estimate-24594631.aspx

Subject:  Re: UTSI Update Date:  9/17/2006  11:44 PM
Author:  whatismyoption Number:  484 of 489

Hey Jim,
Thanks for the reply and your estimate for next year. I was hoping you'd comment.
I should have taken that BlueHawk comment out before posting online. They are an Investment Research firm and I had access to their stock scorecard for a while. The scorecard was mechanical so the price was not based on detailed examination of UTSI.

You said
I think your next years EPS estimate is too optimistic but the Wallstreet consensus may be too pessimistic.
I think you are right on with this call, though I think you held back and omitted the word “way” as in way too optimistic ;-) I had originally put down at 80 cent eps hoping to give people an easy target to get some bearish views, then decided even 40 cents should still elicit bearish views. However, I'm going with that number now as my wild dreams number.

The main bearish views I read are around the declining PAS sales. I think that is old news and the company is positioning itself in new markets, though really I still have to read a lot more to really understand them. Reading your posts has helped a lot.

Here is where they see revenues in Q3:
• Revenues from our PCD (Personal Communications Division) should contribute approximately 55% of total revenues.
• In the PAS handset segment, revenues should be approximately 12% of total revenues.
• Wireless infrastructure revenues should be approximately 18%.
• Broadband revenues should be approximately 10%.
• Services revenues should be approximately 5%.


Thanks Jim; and whether the price rise comes from positive eps or from expansion to 1.5x tangible book value, I see value and will continue to hold. I think the risks have diminished and they are demonstrating themselves to be a viable concern.

Just to go on an on. I first came across UTSI from Michael Murphy who flogs a newsletter I briefly subscribed to. Here is his original call and my quick thoughts from early this year..
Buy UTSI under $10 for a move to $25 this year.
I was tired of taking peoples unsubstantiated views as gospel and had just begun delving in to the world of valuations. Here is what I thought then.
What the heck could he have been basing these numbers on?
High est eps for 2007 is .28 which would give it a forward p/e of 90, ludicrous!
So let us imagine they start hitting all their targets and p/e goes back to recent high of 30 from mid 2003, that would imply .83 earning in 2007. Yeah right Michael, can I have some of what you're smoking.

Cheers
Dean
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