The Good, the Bad, and the Naive:
The Good: Woe, where do I start?!!!
In one year's time, ABEW has transformed itself into one heck of a software company with almost 40 software engineers, multiple software products, and License Agreements with some of the largest chipmakers/semi-manufacturers in the world. However, for THIS evaluation I will use the information in the recent 10-Q and add my own opinion as to what I believe is taking shape.
As stated in the 10-Q..."As validation of our strategy, our engagement with Texas Instruments ("TI") has picked up activity this quarter and we believe TI will become a significant customer." Let me repeat that last part: "our engagement with Texas Instruments ("TI") has picked up activity this quarter and we believe TI will become a SIGNIFICANT customer." [emphasis mine]
Now, as you may recall, after the shareholders meeting I specifically mentioned that the President of ABEW-India, Mr. V.V. Sundarem, announced the hiring of a very experienced Human Resources person to prepare them for an influx of business. I also mentioned that our V.P. of Sales, David McCartney, has increased his correspondence with our India Operations by phoning them every Monday morning for a conference call. It is evident that this increased activity between our Sales V.P. and our Operations in India was the beginning stages for the increased work-load from our TI/Infineon/ZMD/Radiocrafts relationships.
"...and we are working with ZMD and Infineon to set up a similar process. We note similar progress with our ZigBee module partner Radiocrafts, which now has more than 35 OEMs using our ZNS stack and ZAPP (SPPIO) application. We anticipate many of these will go into production in the coming quarters." Ahhhhhhhhhhhhhhh can you say revenue?!!!
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Now for the "Bad"...
Would love for them to announce SEC approval and financing but, according to the remarks by Gene Sharer on the Airbee web site, all SEC filings have been submitted and they await their response. Also, according to the recent 10-Q, they are talking with several institutional banks to secure our financing.
"Numerous discussions with investment bankers throughout the country lead us to conclude that additional financing will be available."
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Now for the "Naive"...
Folks, as you well know, the ZigBee Alliance has decided to revise the specification from 1.0 to 1.1. In doing so, almost every single company associated with ZigBee has had to delay the production of their products for several months.
Additionally, because of this delay, one would have to be very naive not to expect ABEW's financials to show an increase in their indebtness. (The fact is that even Ember announced they needed to raise another $12 million for their company.) The good news is that ABEW has survived in this dry climate for the past four years and now it appears that they are ramping up their productivity for the big pay-off.
Their strategy of aligning themselves with the Big Boys has been nothing less than sheer genuis. We continue to sign up more and more international corporations which, by there actions, validates our sofware. This "increased activity" with our customers leads me to believe that the ZigBee Industry is just months away from mass production. When that happens, you can expect our "debt" to disappear and our profits to rocket skyward. And oh yes, our PPS should follow suit very quickly!!!
Just my two cents for what its worth.
abew4me
Disclaimer: All comments are just my opinion and should NOT be considered as factual.
(Voluntary Disclosure: Position- Long; ST Rating- Strong Buy; LT Rating- Strong Buy)
