If the market tanks, this stock will roll over bad.
Overall market looks grim. I think the worst case scenario would send us back to the .60's. But probably not .25 or .30's like the last two downturns. I arrive at 35% tax-adjusted eps of .13 for FY '10. A forward multiple of 5 wouldn't be out of the ordinary for a bb stock in a bear market. Reminding that we used to trade at a forward multiple of 3 or less, and that was after stringing together several quarters of consecutive profitability and increasing cash flow and increasing eps guidance. Let's hope those dog days of extreme undervaluation are over. For the people who say a multiple of 5 is unwarranted, well yeah, that's the point. A p/e of 3 wasn't warranted either. I really do wish that a team of iHub bandwagon jumpers can change the dynamics of our valuation, but first we have to get around the problem that all the new momentum crowd looking for the quick score will be running for the door. Donovan needs to come through with more contracts pretty quick - sooner rather than later - or else these new sources of revenue won't be hitting until late 2010, or into 2011. One thing is for certain - FY '09 will not be our year of ramping. But FY '10 is looking more probable, and will be more definite if Donovan can act quickly.
