PLT - Plantronics
It was a tough week, Nasdaq and Dow went down 1.8% and 2% respectively, but if you followed my advice - AET, it went up 1.6% (opened on Monday at $39.6, closed on Friday at $40.25), and beats index by 3.5% in a week. Isn't it great?
Do you see more and more people use wireless headset on the street, in the office or at home? It is not only cool, but also a productivity tool (free your both hands), and healthy tool (reduce the cellar phone radiation). If you haven't got one, go get one,
and very likely, you will get Plantronics - PLT.
Plantronics specializes in various types of headset system, for bluetooth mobile, cordless phone, etc. It also manufactures speciality communication equipment for hearing-impaired people. It has a brilliant marketing team (remember the astronaut in the commerical?), and design team (attractive products).
An average 30% revenue and 45% incoming growth in the last 2 years, however its stock stays flat at around $38 during the same time period, until early May this year, it plunges from $38 to $22 in 2 weeks. Closed at $22.05 on last Friday, its P/E = 13.2, PEG=0/7, P/B = 2.3. Comparingit with LOGI, its main competitor, you will see what a value stock it is.
So why the drop? In the last quarter, though its revenue continues to grow fast, its profit margin drops significantly. No wonder, check out amazon.com, its product provides deep discount (40% - 50%, it is a competitive business). But the other reason (which is ignored) is Plantronics just purchased Altec Lansing last year, and still in the process of merging operation. By the way, this $160+ million deal makes good sense to me. Altec Lansing makes decent audio equipment, and is a profitable business ($15million profit last year), and complements well with existing business.
The other catch is that its new product direction is to combine both its communication and entertaining business - one handset for both phone and MP3. Isn't that great? one headset switching from music to phone calls seamlessly. The best part is the company is priced as if it has no tomorrow. Very rarely you will find a great product and brand with a cheap stock price, and I think this is one.
Do you see more and more people use wireless headset on the street, in the office or at home? It is not only cool, but also a productivity tool (free your both hands), and healthy tool (reduce the cellar phone radiation). If you haven't got one, go get one,
and very likely, you will get Plantronics - PLT.Plantronics specializes in various types of headset system, for bluetooth mobile, cordless phone, etc. It also manufactures speciality communication equipment for hearing-impaired people. It has a brilliant marketing team (remember the astronaut in the commerical?), and design team (attractive products).
An average 30% revenue and 45% incoming growth in the last 2 years, however its stock stays flat at around $38 during the same time period, until early May this year, it plunges from $38 to $22 in 2 weeks. Closed at $22.05 on last Friday, its P/E = 13.2, PEG=0/7, P/B = 2.3. Comparingit with LOGI, its main competitor, you will see what a value stock it is.
So why the drop? In the last quarter, though its revenue continues to grow fast, its profit margin drops significantly. No wonder, check out amazon.com, its product provides deep discount (40% - 50%, it is a competitive business). But the other reason (which is ignored) is Plantronics just purchased Altec Lansing last year, and still in the process of merging operation. By the way, this $160+ million deal makes good sense to me. Altec Lansing makes decent audio equipment, and is a profitable business ($15million profit last year), and complements well with existing business.
The other catch is that its new product direction is to combine both its communication and entertaining business - one handset for both phone and MP3. Isn't that great? one headset switching from music to phone calls seamlessly. The best part is the company is priced as if it has no tomorrow. Very rarely you will find a great product and brand with a cheap stock price, and I think this is one.
posted by Siyu LI at
8:50 PM
1 Comments:
Siyu:
Yes, PLT makes sense.
When I was working at MetLife, we all used PLT headsets. No other brand. I might get into this later...
Good luck with your trip!
By
Jaewoo, at May 24, 2006 11:53 PM
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