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Tuesday, February 17, 1998
Friday, Iomega closed
at $9 1/16, down $1/2
(-5.23%). TODAY'S RECAP: Even though the stock market was closed yesterday, the Iomega message board was as active as usual, debating such issues as Nomai disk sales and true stock price numbers. Fools also shared information from recent publications or news releases about the uses of Iomega products by varying manufacturers. Enjoy! INDEX: Use the Search or Find feature of your word processor to locate the article number (Find: 1++, 3++, etc.) - or use AOL's Edit>>Find in Top Window Feature. If Find in Top Window is dimmed, just click on some text, anything, in the IOM Today window and try again.
1++ Opua provides a summary of the specs for a newly-developed "internet
appliance."
Recap written and posts compiled by TMF Weekly. _______________________________ And now, the Best of the Board...Started 9:00pm ET 2/15/98. 1+++++++++++++++++++++++++++
Subject: ZIP Drive in set-top boxes! Paraphrased from technical magazine, QNXnews, Vol 11 No. 2: California-based NEON Technology, a leading-edge internet appliance vendor offers an internet set-top box OEM kit decribed in part as follows: .....Running on a 100 Mhz Intel DX4 processor, Neon's box has a built in 33.6Kbps data modem, a 14.4 kbps fax modem, RCA jacks an S-Video jack for TV, hardware ports for a printer, a ZIP drive and a VGA monitor. ....Besides offering the net on a TV set, the box offers voicemail, fax capability, internet telephony, and multiple Email accounts... NEON is looking to partner with OEMs who will license the kit and customize it for various markets. A Toronto based OEM has already jumped on the oportunity and is releasing a set-top product based on NEON's technology to the Canadian market this fall. These "appliances" ARE coming....and they WILL need storage. P.S. Maybe we should buy some NEON stock- look how good they did with the bulb thing!! 2+++++++++++++++++++++++++++
Subject: Computer shopper I just read the new March Computer Shopper and I have come away with some very encouraging signs. 1. Excellent review of the new ZipPlus ("Iomega' Zip Plus Drive Outzips the Original") that concludes with the following "The original Zip drive may be a tough act to follow but the Zip Plus is a clear improvement to an already proven product. We predict that Iomega will have another winner on its hands". 2. When Dell's XPS D333 high end system was reviewed and didnt contain a Zip drive as a standard feature they expressed surprise and mild disgust ("we were surprised that the system lacked an Iomega Zip drive, which is a $99 option and, in our opinion, almost a mandatory tool with this much storage on tap") that a high end system of this type would not realize the necessity of a Zip drive. Conversely they praised Gateway's G6-333 and their inclusion of a Zip drive in their system. 3. Several notebook manufacturers advertising that people can add a second HD, Zip drive or LS-120 to their configuration. Given the choice consumers have overwhelming chosen the Zip drive and I fully expect the Zip to destroy the LS-120 entry here as well. 4. The number of hardware, peripheral and software companies who in advertising their products mention Zip, Jaz or Iomega by name in the text of their ad. No other product or company has the same name recognition accorded Iomega. Case in point Diamond while advertising their Fireport SCSI Adapter cards has the following opening sentence: "Connecting scanners, printers, hard drives, ZIP or JAZ drives to your Windows PC is both fast and easy with the Fireport family of SCSI adapters from Diamond Multimedia". 5. In an article titled "Farewell to the Floppy" although the author is non-commital he includes this passage; "The shift from aftermarket purchase to OEM inclusion (mostly Zip drives) accounts for most of the jump in removable drive usage we at Computer Intelligence have seen over the past two years". There is also a graph showing PC's using Removable Disk Cartridge Drives from: 1994 - 4.3% 1995 - 5.0% 1996 - 17.8% 1997 - 26.0% 6. OEM's such as Dell are now reducing the prices for a Zip drive in their system. Dell now offers Zip for $79 with 1 disk (still the best buy), but even more encouraging in my mind are 2nd and 3rd tier OEM's like ABS Technologies offering Zip for $89. More and more of these OEM's are offering Zip below $99 which until recently was the standard price. This suggests that Iomega may be able to offer these companies Zip drives at a lower cost than was previously available. This further suggests that Iomega is continuing to lower the cost for making a Zip drive, seeking further penetration in the OEM market and that OEM's can retain acceptable margins while reducing the cost to consumers. 7. Harmony Computers in Brooklyn , NY (www.shopharmony.com....800-870-1663) is advertising the Zip Plus for $169 and the Jaz 2 Gig internal/external for $449 and $529. This is significantly lower than the standard advertised price. 8. Both Harmony and Tri-State Computers are advertising the SparQ for $179. Syquest keeps hammering away at those negative gross margins....lol. 3+++++++++++++++++++++++++++
Subject: Iomega Sales Force (Re: Nomai's Almost a Zip is not a Zip) RulonKB posted: << If someone from Iomega is monitoring this chat (and they should): Think the right Naomi strategy, until the suit is settled, would be to make sure the Iomega salesforce is fully educated on the risks of using the Naomi disks in the Zip drive. They should discuss this with their buyers if they already haven't. If I were in charge of purchasing products for Best Buy, or Comp USA etc., I'd really have to think twice about giving valuable shelf space to a product that might/will upset the customers who shopped in my stores. If someone in sales or marketing at Iomega isn't already having these conversations and providing appropriate data, THEN...I'd sell the stock. >> Don't be surprised if Iomega were not doing that. But I don't think that would be reason enough for me to sell (I don't know about anyone else though). I don't even think Iomega sales force is fully educated on "Why Zip Not Competitions" and I don't think there is a sufficient educated Iomega sales force in turn to go around to tell the chain store Buyers, the chain store salespersons, and the buyers & users of BIG corporations about "Why Zip Not Competitions" in general, let alone the particular Nomai matter. The Nomai matter involves an ongoing lawsuit and may be a little bit more tricky and therfore it may not be a good idea for an "official Iomega sales force" to talk about the particulars of the situation openly, freely and perhaps loosely here and there. However, I think the Iomega sales force, if educated and sufficiently staffed, can do a good job in preaching about "Wy Zip Not Competitions" in general terms. I will be happy to see an educated Iomega sales force in sufficient number to go around to tell the chain store Buyers, the chain store salespersons and the Buyers & users of BIG corporations about "Why Zip Not Competitions" in general terms without naming any competitions by names loudly. I don't think Iomega has been doing that, not anything that I noticed. But that doesn't mean Iomega didn't do that on a smaller scale. And hopefully that doesn't mean Iomega won't do that or do more of that and greatly increase the effort in the very near future. It is something that I will watch. About "someone from Iomega is monitoring this chat" ... LOL ... Are you kidding? Even if they do, there are so many posts, so many different ideas and so much "noise" out here. Which one of the ideas will they following? 4+++++++++++++++++++++++++++
Subject: Re: BUY At 5 or 6 TomTerf wrote: << Start buying at 4 1/2. Load up at 3 >> I see a lot of people throwing numbers around. I doubt there is much thought behind them. What logic would lead someone to conclude that Iomega would reach a market cap of $850 million?. That would roughly be a 0.5 PSR on trailing sales and a minuscule 7 trailing PE. Name one other company that just completed a fiscal year where they grew earnings over 75% year over year, a quarter that saw 27% sequential growth in earnings, doubled net income, grew gross margins over 59%, and holds a dominant market position; selling at a trailing PE of 7 and a trailing PSR of 0.5. I would really like to here of any others...I won't hold my breath though LOL Too many people investing in the market see stocks as prices not market caps. It is a huge mistake. It is such thinking that makes people believe SYQT is cheap because its per share price is $3. That all $3 stocks are the same price. The share price is meaningless; the market cap is all that matters. If all a company had to do was pay $850 MM for IOM I think it would be snatched up instantly; David Dunn might even take it private ;-) That would solve a lot of his problems wouldn't it? So before you throw out these numbers like $3 or $4.5 lets remember that IOM only has a PE of 22 now and expecting it to drop 50% from here is assuming much more than momentum. No professional with published expectations expects IOM's earnings per share to fall in FY98 or anytime soon. IOM's trailing PE at a share price of $8.5 is 20. Anything can happen short term in the market because of almost any reason, but long term all that matters is earnings growth. If IOM can grow earnings just 20% per year (much less than anytime in the last 3 years) they will leave $8.5 behind given time. _______________________________ End Report. Posts covered through 9:00pm ET 2/16/98. _______________________________
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