Replies to post #14890 on Wave Systems Corp. (fka WAVXQ)

[rachelelise]

Doma

There is a reasonable quantitative model which will dictate our share price. I like a quote I saw about underestimating how long it takes in the short term and overestimating how long it takes in the longer term. If (and it is a big if) deployment of TPMs follows the OEMs schedules, there will be 10's of millions of such devices in devices within 18 months. If users conclude that Wave's services are essential to make proper use of the devices, there will be a steady rampup of licensees with perhaps a quarter or two lag. At some point, premium services will be sold upon initial sale instead of the after market. If the $30 range is in the ballpark, then the share price will respond much earlier than 3 years from now. Lots of ifs I realize but I am not sure that Wave would ever get to 20 (eg very successful) if they can't get there earlier than 3.5+ years. But we're all guessing here.

[go-kitesurf]

Doma,

Where do you get your stages from?

I made them up since its my model of stages to explain my reasoning, not yours. I guess I should elaborate (not that ANY of our "models" will be correct):

1st stage - client/server software or applets
2nd stage - Embassy firmware licensing for PC TPMs (NSM already + ???)
3rd stage - E firmware "premium services" multi-industry deployment (PC/STB and Wi - NSM/Infineon/Atmel/STM/BRCM start "starting to publicly ship across the board")
4th stage - E firmware TPM complete replacement (meaning ubiquity)

I don't expect $20/share until 'outsiders' (funds/large money)recognize something happening more than software deplyment in PC-land. Once STBs, Cell phones, etc all enter the mix and Wave gets a first deal with a hardware company to manufacture chips with Embassy technology the stock should move beyond a ($20-30/share company) within a two year timeframe. But only then, and that's between steps 2 and 3. It could appreciate more, but not in the 2 year timeframe I was referring to. In two years, with only software deployment, unless something else happens, 20 bucks is max in my mind.

I think Wave's potential is one of two things (generally):

1) Wave is a software company with a couple hardware relationships in 5 years (NSM/Intel) ($40 per share in 5 years)...or....

2) Everything Wave dreamed would happen did...and they have Embassy chip technology all over the place with software services deployed all over the place and are "ubiquitous". This is a $150-200 stock in 5-7 years.

Actually, I don't really focus on valuation and chips deployed. Why? The stock is $2.80. For the CHART to hit a $100, there's gotta be some serious buying/fundamental news and profit taking happening in many stages for it to hit that level. Because of this, I don't care what's happening, unless Wave releases a slew of incredible PRs AND shows revenue to back it up, its not going to hit $100 in a year, or two, or three. The possibility of a QCOM is pie-in-the-sky. QCOM took more time than you all realize to get its recognition before it even rose to nose-bleed levels, and it sold off 50% of its value before it did that. Its going to take a lot of time, business success, and recognition to get to $100. This is my view.

I will never forget that Microsoft is a problem, and will continue to be a problem. I will also never forget that all the companies that Wave is dealing with expect to have a piece of the pie, as well. To summarize, Wave is taking a chunk of revenue from all the TCG companies...collectively. (IMO) I don't think they are out of the minefield yet - at all. But I do think they have a hell of a lot more going for them than 98% of the investments out there....