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VTSS Investor Forum

Mindspeed warns....stock goes up; VTSS warns...TIMBER

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What does that tell you? Maybe the street gives MSPD a pass because they don't have a history of lying, cheating and deceipt? What a useless board and management team we have......it is beyond belief and I would say almost criminal how they continue to pat themselves on the back with fat salaries, perks, bonuses etc . I would think that the Board with hedgie representation would become activists for change, considering the state of things but I'm not seeing any evidence of that. Same old, same old......

Posted by sharpinvestments - 14 years ago

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Sharp

I was thinking of this the other day. Gardner is on his 3rd board of directors. He has survived through a BOD turnover 3 times, a massive, ruinous dilution of the shareholders in the refinance, revenue shrinking to 50% of what it was when he first assumed leadership, directing R&D for the past 5 years and spending $250 million to introduce 50 new products and has secured well over a hundred (or hundreds) of design wins which add to what now is less than $1 million in new product revenue, has taken the market cap of the firm from over well over $500 million to less than $60 million and has still kept his job.

Either he is one of the most talented CEO's of all time or this is a textbook study of all that is wrong with american capitalism. I have to believe this is a guy you don't want to talk to. He will convince you that you are lucky, and should be happy, he is doing such a good job. And apparently everyone leaves his presence thinking just that. With charisma like that he really should be in politics.

Posted by dlog - 14 years ago | Updated 14 years ago

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"... he really should be in politics..."

So he could do to this country what he did to shareholders? Christ, CRG makes the Detroit Public Schools and City Gov'mint look like Ronnie Raygun's 'Shining City On a Gosh Darned Effing Hill'....and I like Ron, if only because he sucked less than his opponents, sorta like Dubya (shudder, but true)...and unlike the Bamster (shudder, but even more true)....though at the time everyone I knew loved Big Ron's ass because his policies were 'good for gardening'......ya didn't have to be stupid to figger out corn didn't fetch $200 an ounce.

Sold at market earlier today $2.38-$2.43.

Posted by altrfan - 14 years ago | Updated 14 years ago

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At 11 cents pps (pre-split) the CEO should be jailed. It is a case of a CEO that hand picked their own BOD, everyone got fat off of the shareholders money. The idea behind a BOD, is to have a watchdog for the shareholders (chosen by the shareholders), not a lap dog for the CEO (chosen by the CEO). Gardner ripped off the shareholders...plain and simple.

Posted by OKSPSNOW - 14 years ago

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Look who his mentor was?

G

Posted by G - 14 years ago

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Semiconductor maker Mindspeed Technologies (Nasdaq: MSPD - News) slashed its fourth-quarter revenue outlook to $40.5 million from $42.2-$43.9 million. Analysts expected revenue for the quarter of $43.14 million. "We experienced a weaker demand environment in the fourth quarter, primarily impacting our high-performance analog and legacy wide area networking business, as a result of weakening demand in the communications infrastructure market," Chief Executive Raouf Halim said. Shares of Mindspeed rose 7.1%.

Unfrickin' believable. Can't wait to hear Chris rationalize the VTSS situation (bullshit us) at Imperial Capital.

Posted by sharpinvestments - 14 years ago

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MSPD forecast a sequential revenue drop of 4% while VTSS forecast a sequential drop of almost 7% for product revenue. But I think it was the huge 18% drop from prior guidance that has really clobbered the stock. MSPD only cut their guidance by about 6%.

The 2% reduction in margins is probably accounted for by the delay in expected IP revenue (the new guidance for Q4 margins matches the actual for Q3 product revenue). If we figure about $1.5M for the IP in the prior guidance, that means they cut their product forecast by $5.3M (15%). I wonder how much of that was supposed to be new products and what the ramp up of their new designs is really going to be. The sharp cut in workforce and facilities is probably better guidance than anything CRG says. What was left of his credibility is now completely shot. I'm surprised B. Riley still has a buy rating.

Posted by thereinman - 14 years ago

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i can't console you - -

but i have a much different take on the quarter.

vtss missed the margins by the loss of bookable IP revenue.

they have never stated what they are selling as IP - -but the press release about FEC (error correction at 100 Ghz) is about as close as they want us to know in public.

operating revenues will come in a bit below or even flat to the 3rd Quarter. this is all from their largest customers in china slowing deliveries. the box makers are all in slowdown mode - and that is being seen across the board. sorry it has to come at the expense of American workers.

but - i give vtss lots of credit for cutting the expense side and being real - -that is what Grand has been calling for in posts here and talks with crg. this corp can be rightsized to produce profits rather than losses - not one other press release from their peers has mentioned expense cuts. if things do get worse first, at least we are working from a lower expense base. and the revenue increases projected for the second half of 2012 might even slip into 2013 - but the internet is not shrinking - -we have a call on the growth of the net - -

perhaps they are finally getting the message - or Marty is a teabagger who will run this corp by the numbers. there is no reason that vtss should not be profitable (tho slightly in these tough times) with the margins they have - -but they have to live within their means - -sounds familiar.

we will see a turn in fortunes sometime in the next two years.

vtss will see revenue increases toward their $45MM target.

this corp is being very well managed thru tough times.

they are continuing to lower the break-even while they wait for the flood of orders - -no boxes - -no orders - vtss is in the mix - -you will hear more tomorrow - call it lies - -that is fine with me.

i will also say that AMCC and MSPD are good long term shorts as they are both going to suffer in the next product phase. MSPD is only up because of the NETL buyout.

i will also say that the FEC is worth more than the entire market cap of VTSS today. and when the market cap is half the revs - that is a sure sign of market inefficiencies. volume has been light on this slide - remember that there are some 25MM shares that can vote with a sell every trading day - - i will also call out the semi anal cysts for their lack of understanding of the chips that comprise vtss and their peers - - but that all changes when vtss is seen as a peer again - -we are still on probation as a felon - - and that won't change until revs increase and profits are posted - -then the cysts will wonder why vtss is selling chips again.

there is your pump for a rainy Oct. 5 - remembering that vtss went to $9.20 after the historic low of $1.80.

we gotta have one pumper on board - -

dW1

Posted by daWiley1 - 14 years ago

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thanks DaWiley for your time and insight. I was surfing the Yahoo board and find that I have been quoted by none other than Vent. I have reached a new nadir in my invective. I am going to have to reappraise.

I guess I can take some solace that all others in the industry have revenue shortfalls as well. Were it not for the low cash level and the debt I would not be too concerned actually. I really believe the reduction in force was done solely to save cash. VTSS is not in a good position with cash.

I said sometime ago that if this product cycle does not generate any meaningful new revenue growth Gardner should be held fully accountable. But I am willing to wait until mid 2012 before concluding VTSS has missed it again. I still have some significant problems with the way management positions itself with the investment community. Management, is not getting good advice from the investor relations counsel it employs or if they are they are not listening to it.

Posted by dlog - 14 years ago

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Big interest on tomorrows presentation is what is happening to cash. At $30 million in revenue not too hard to see $3 million in negative cash flow. I think there is a hefty interest payment due in October.

Posted by dlog - 14 years ago | Updated 14 years ago

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GOOD NEWS GOOD NEWS!!!UPDATED: Report: Base station shipments to jump 14% in 2011
October 4, 2011 — 10:33am ET | By Phil Goldstein


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Worldwide shipments of mobile base stations will increase 14 percent in 2011 despite continued sluggishness in the global economy, according to a new report from ABI Research, indicating that carriers will continue to try and keep up with surging data demands.

The report also said that there will be increased base station orders for 2012 and beyond. ABI noted that the surge in base station shipments is primarily being driven by increasing mobile data traffic in the United States and China. In China, the three main operators are expected to double their total number of 3G subscribers by year-end.



Read more: UPDATED: Report: Base station shipments to jump 14% in 2011 - FierceWireless http://www.fiercewireless.com/story/report-base-station-spending-jump-14-2011/2011-10-04#ixzz1Zwgv6Kzh
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Posted by GARIF - 14 years ago

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"I'm surprised B. Riley still has a buy rating." Who the fuck is B. Riley and does anyone other than VTSS (and B. Riley) care?

Posted by G - 14 years ago

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I am beginning to have a different take on this whole thing. Everyone is reporting "soft" results for the quarter and so VTSS is not different in that regard. AND THERE HAS NOT BEEN ANY LARGE SELLING BY THE 60+ INSTITUTIONAL HOLDERS - look at the volume.

I you take the low end of the previous estimate - $35m - and assume the "delay in an intellectual property contract" of say $3m - and take another $3m off for the softness then you are at $29.

If the get that $3m back in the 4th Qtr - $32m and the contract is completed - $35m. Take the $21m Operating Expenses and add 57% of the increase Rev $22.7 and you suddenly have a $9m Operating Profit. This could turn rather quickly with any improvement in the numbers.

I just don't totally think that this is as bad as it sounds. Of course perhaps the funds haven't dumped it "yet". VTSS did wait until after the end of the quarter to announce and thus prevented the funds from having a chance to clean up their portfolios - who know. They are still there and so am I. I did recharacterize my 2010 Roth this morning however.

Satbob

Posted by Satbob - 14 years ago

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G - as an owner of Vitesse you may be interested in knowing that B. Riley makes a market in Vitesse shares, is one of only two investment houses that have a rating on Vitesse and hosts an annual investor’s conference with presentations by Vitesse and about 150 other small to midcap companies, including many networking and optical companies. Their buy rating is from an analyst that was recently rated #2 in the Wall Street Journal’s Best on the Street survey in the telecom equipment category. Does any of this matter? I guess that depends on how you choose to make your investment decisions.

For those who care here’s B. Riley’s Oct 3 update:

Lowers Q4 outlook; Reduced estimates; Lowered price target from $6.50 to $4.50; Maintain “Buy”

Posted by thereinman - 14 years ago

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Friday, October 14, 2011

Vitesse closed the day at $2.77 up .35 or 14.46% for the day.

This is a nice gain for what Vitesse usually does on a daily basis.

Volume is still on the low end at 65,900 shares, but it is nice to see the majority on the buy side.

altrfan,

looks like you should of held on to those shares you sold at average of 2.40

Posted by christ3opher - 13 years ago | Updated 13 years ago

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Company EBITDA Debt D/E
VTSS 2.17 57.22 26
MSPD 8.44 4.22 1

Posted by phobos - 13 years ago | Updated 13 years ago

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The problem with VTSS is the Debt to EBITDA ratio. This indicates that, at present EBITDA levels, it would take 26 years to pay off VTSS' debt. This makes MSPD much less risky. VTSS has one of the highest debt levels relative to EBITDA of any semiconductor company I could find.

Comp. ---EBITDA-----Debt----D/E
VTSS ----2.17 ----------57.22---26
MSPD ----8.44 ----------4.22-----1

Posted by phobos - 13 years ago | Updated 13 years ago

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