Current Share Price Value Estimates At 2007 annual EPS of $0.07 and revenue of 100 mil, year over year growth is as follows: EPS = 600% Revenue = 76% Both are accelerating, that is both values are greater than previous year over year comparison (2005 to 2006 growth in EPS = 200%; growth in revenue = 48%)
1. Per Yahoo, competitors have an average PE of 35, however, these companies are averaging only 14.7% quarterly year over year revenue growth – whereas SOYO has much higher growth. Therefore, using Yahoo value should give conservative estimate: X = share price = (35 x 0.07) = $2.45 = reasonable target price for year end 2007. If factor in growth differences using ratio: 2.45(76/14.5) = $12.8
2. Yahoo provides PEG ratio for industry at 1.82. Using PEG ratio factors in growth. Will use conservative growth based on revenue and not the much higher EPS growth although formula calls for EPS growth. Annual revenue growth is estimated at 76%. 1.82 = (X/.07)/76 X = share price = $9.7
3. Using PE = % EPS growth rate = 600% (throw out – too high). Will again use forecasted 2007 annual revenue growth for estimates instead of EPS growth. X = (76 x .07) = $5.3
4. Account for growth using a common method of taking PE to be 2 times EPS growth – but that would put at 1200%, and we already decided to use 76% - so PE should be 152 – which is not that unreasonable given rate of growth occurring. X = (152 x .07) = $10.6
Future Share Price Value Estimates 2008 (estimate) Revenue: $200,000,000 EPS: $0.21 Based on estimated revenue growth of 100% and EPS growth of 300% - which is conservative given that both revenue and EPS are accelerating and this assumes EPS is decelerating. Note that Honeywell TVs will be selling in 2008 and other higher margin products should be gaining traction. Disclaimer: These estimates are very rough and subject to dramatic change.
Using PE of 35 gives share price = $7.35 = reasonable target price for year end 2008 if meet above estimates Using PEG 1.82 gives share price = $38.22
Notable Information • Has deal with Honeywell to launch Honeywell Consumer Electronics Division, including Honeywell LCD TVs and computer monitors– see details here: http://investorshub.*********/boards/read_msg.asp?message_id=23858842 • In 2007 began selling Prive brand of LCD TVs and Monitors in all of Wal-Mart's 278 retail stores in Canada • MMA is the fastest growing sport in the world. SOYO has significantly increased its advertising targeting the male 18-35 year old demographic. Research shows in-content advertising targeting the MMA and specifically the UFC's loyal fan base to be very effective. • In 2007 began selling Le Vello Brand Home Theater furniture – a higher margin product. • Announced plans to get on the AMEX as soon as possible – need to reach share price of $2.00 – they meet all other AMEX qualifications. • Sell products in Wal-Mart, Best Buy, Circuit City, Staples, Micro Center, Target.com, Walmart.com, eCost.com, Fry's Electronics, PC Mall, Office Depot, Office Max and others – as well as through their own direct to consumer eStores. • Sells products in USA, Canada, Mexico and South America and also has sales in UK, Europe, Asia, and South Africa.
Goals For Near Term: Per 6/26/2007 Press Release: -- Launch of Honeywell Products -- A consistent communication platform created and used more regularly. -- A revised Website. -- A revised IR section accessible on our website. -- Plan for getting off the OTCBB and onto a more formal exchange (AMEX). -- Investor and Corporate fact sheets available monthly. -- More communications about where we are going and the steps we will take to get there, including a full "State of the Union" type Shareholder Update -- Launch of Le Vello website -- Launch of Prive website -- Launch of Honeywell Consumer Electronics Website (www.honeywellce.com) -- Add one additional National Retailer for our LCD Monitors. -- Expand product line and presence into Mexico. -- Launch Extended Warranty program -- Continued double digit sales growth through the year 2009.
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Honeywell decided to enter the consumer electronics market. Their primary products would be LCD TVs and Computer Monitors. Honeywell had several reasons for entering this market, including: 1. A history of knowledge, experience, and innovation in LCD products – as evidenced by Honeywell’s numerous patents and licensing agreements as well as existing LCD products (e.g., aviation monitors). 2. Recently filed lawsuits by Honeywell against LCD manufactures infringing upon their patents. Honeywell has several LCD patents and licenses technology to nearly all world class makers of LCD displays. Honeywell has learned from previous suits that the filing company (i.e., Honeywell) is more likely to win the case and collect higher damages (or force a greater settlement and/or licensing fee) if they have a product on the market that is directly impacted in a negative manner from the patent infringement. 3. Honeywell could obviously offer similar products at a cheaper rate by not having to pay a licensing fee for their patents – or if partnering with a company (SOYO) by offering a discount for patent use. 4. Honeywell’s LCD research and development division and LCD specialists likely have numerous innovative features that would improve existing products on the market – but without a product themselves – no way to readily bring such features to the market and directly profit from them. Honeywell has a demonstrated history of developing innovative LCD products. 5. Honeywell lacked ties to low cost industry suppliers (such as those in Taiwan) and an established distribution network. 6. Honeywell lacked close supplier relationships that allow the ability to quickly integrate new product changes and innovations.
Thus, Honeywell searched for a company to partner with in bringing Honeywell consumer electronic products to the market and selected SOYO. They approached SOYO and the two companies negotiated and arrived at the current deal.
SOYO has stated that they were selected in part due to their ability to quickly incorporate new technologies and adapt to a dynamic and fast moving technological environment. That indicates that Honeywell does have some new LCD innovations to bring to the market and will likely incorporate these into the TVs and monitors. It further implies that Honeywell not only plans to have some new features in the first TVs that hit the market, but intends to add new innovative improvements as they uncover them in their research and development.
SOYO states that the LCD TVs will have new features and that these features are closely guarded confidential business information. The TVs will be designed to compete with the state-of-the art, top-of-the-line models available anywhere in the world and will have a cheaper price tag.
A misconception is that SOYO approached Honeywell – which is not the case. The odd thing is that SOYO will pay Honeywell a license fee and percent of profits. I believe this is because Honeywell has agreed to assist in sales and marketing and Honeywell has agreed to provide SOYO with its latest technological innovations in the LCD field. This technology may set the Honeywell-SOYO products apart from others on the market. The company indicates that Honeywell sales and marketing are playing an active role. From 10Q: “Features of the larger screen TV are considered confidential, and will not be released to the public until the television is ready for launch.”
STEP 2: The DEAL between SOYO and HONEYWELL Honeywell licenses brand name for flat-panel televisions By Bob Sechler March 5, 2007 Honeywell International Inc. may be best known for its thermostats and aircraft engines, but flat-panel televisions soon will bear the company's name as well. Honeywell-branded TVs are expected to go on sale this year under a licensing deal between the Morris Township, N.J., conglomerate and SOYO Group Inc., a small electronics manufacturer
The deal marks Honeywell's first foray into the consumer-electronics sector, although Honeywell has an active brand-licensing program for portable home air filters and other products. SOYO will design and distribute the liquid-crystal-display TVs and pay Honeywell royalties. In addition, the deal eventually may result in Honeywell-branded computer monitors and displays, although executives of the two companies declined to elaborate.
They wouldn't release sales forecasts or other financial details, beyond saying that the six-and-a-half-year agreement will provide a minimum of $3.84 million in royalties for Honeywell. The sum is inconsequential compared with Honeywell's $31.4 billion in 2006 sales. But company executives are intrigued by the market regardless. "We're always looking for opportunities to expand the brand" said Loria Yeadon, chief executive of Honeywell Intellectual Properties Inc. "We think consumers will appreciate having Honeywell-branded (electronics) because they know that there's quality" in the name. Yeadon said she isn't concerned that the move could be a stretch for the Honeywell brand. The company is well known as a technology innovator, she said, and many of its patents are already used in various consumer devices.
Summary of Agreement: SOYO announced in February 2007 that the Company signed a license agreement with Honeywell Intellectual Properties Inc. and Honeywell International Inc., effective January 1st 2007, under which SOYO will supply and market certain consumer electronics products under the Honeywell Brand. The agreement is for a minimum period of 6.5 years and calls for the payment of minimum royalties by SOYO to Honeywell totaling $3,840,000. Sales levels in Excess of minimum agreed targets will result in associated increases in the royalty payments due.
STEP 3: HONEYWELL FILES LAWSUITS Honeywell sues myriad of LCD TV makers for anti-flicker technology March 23, 2007 by Darren Murph * If you think LG has a mess on its hands, it's suddenly not alone, as six other manufacturers touching one point or another in the LCD TV supply chain are now facing a patent lawsuit from Honeywell. In what smells awfully like another patent instance of patent trolling, Honeywell is suing Acer, AU Optronics, BenQ, Chunghwa Picture Tubes, Renesas Technology, and Denmos Technology as it claims that a patented "method of stopping liquid-crystal displays from flickering" has been unrightfully used. The firm has reportedly "sustained damages and will continue to sustain damages in the future," which they feel should translate into receiving incredible amounts of cash in order to resolve the situation. http://www.engadgethd.com/2007/03/23/honeywell-sues-myriad-of-lcd-tv-makers-for- anti-flicker-technol....
Lawsuits Continued March 23, 2007 * Honeywell Sues LCD TV Companies over Display Tech Honeywell has filed a lawsuit in Texas against several LCD TV producers, according to the Taipei Times. The American company claims that key manufacturers -- including ASUS, BenQ, and assembly firms such as AU Optronics -- have violated a patent it holds in the US relating to anti-flicker compensation. The infringment has caused "irreparable harm" to Honeywell's business, the suit reads.
If successful, the court action could severely damage the TV industry by forcing many sets off the market until the feature is changed or removed. AU Optronics in particular would suffer, says the newspaper, as it produces the screens used by larger companies such as LG and Samsung. http://www.electronista.com/articles/07/03/23/honeywell.sues.lcd.makers/
STEP 4: DIGGING into the DETAILS Honeywell & SOYO Connect Further Former Honeywell VP of licensing and marketing joins SOYO. 11-Sep-2007 Change in Directors or Principal Officers --Effective September 10, 2007, Mr. Jay Schrankler and Mr. Henry Song were appointed to serve as directors of the Company.
Mr. Shrankler was a Vice President of Licensing and Marketing for Honeywell International Inc.'s Automation and Control Solutions Group from 2003 to 2007. From 2001 to 2003, he served as the Vice President of Environmental Controls for Honeywell International Inc.'s Automation and Control Solutions. He was Vice President and General Manager of the Honeywell International Inc. Home and Building Control from 1999 to 2001. Currently, he works at the University of Minnesota as an Executive Director in the Office for Tech Communications.
First Honeywell-SOYO Product has arrived The roll out of the first Honeywell Branded products began in October 2007 with the announcement of a line of Honeywell USB Hard Drives in at 1.8 inch format. The product line will be available in 80 GB, 120 GB and 160 GB capacities and the Manufacture Suggested Retail Price (MSRP) will be $249.99, $299.99 and $349.99 respectively. http://www.soyo.com/securadrive/securaDrive_hw_spec.pdf The Honeywell SecuraDrive(TM) contains a USB 2.0 Hi-Speed interface with transfer speeds of up to 480 Mbits per second. The SecuraDrive(TM) line is Bus powered, and each drive comes with a travel case, cables and CD Software. The SecuraDrive(TM) will utilize the Samsung SpinPoint N2 line of 1.8 inch drives which feature 8 MB buffer, 4200 RPM, and up to 1500G of non-operational linear shock. The Honeywell SecuraDrive(TM) password technology allows the user to allocate part or all of the hard drive capacity to be public or private. The Honeywell SecuraDrive(TM) line of drives are compatible with the Microsoft Windows operating systems.
Honeywell Monitors In 2007 SOYO will release a line of Honeywell Monitors. - Initially offered in sizes of 19, 22 and 24 inch wide-screen monitors. Features of the monitors will include: - 4 ranges of motion: tilt, swivel, rotate and height adjustment. - 19 inch monitor will also feature four independent USB ports - 22 and 24 inch monitors will feature three independent USB ports as well as a built in webcam and built in microphone. These will be Tier 1 monitors that will compete with Samsung, Dell, and Gateway, and will be offered at the enterprise level, large office chains, and some of our current channels.
Honeywell LCD HDTV’s In 2008 SOYO will release a line of Honeywell LCD full 1080P HDTV’s. - Sizes will include 42, 47, 57, 65, 70 and 82 inch models They will have multiple HDMI, 1080P, and will be designed to compete with LG, Samsung and Sony, with similar technology, several new features, and a better price tag. Will target the big box retailers with this product on a selective rollout.
SOYO is forming the Honeywell Consumer Electronics Division Honeywell Consumer Electronics Division soon to be launched by SOYO with website address of www.honeywellce.com
CEO Speaks “We’ve set many goals for our Company this year. First and foremost, we want to launch our Honeywell Consumer Electronics Division and get the products into retailers nationwide. We also want to list on the American Stock Exchange. Currently, we fulfill all the requirements to do so, except for our share price. We want to increase our web presence by launching mini-showcase sites for our products. We are also in the process of updating and redesigning our current SOYO website. In addition, we plan to leverage our Honeywell Consumer Electronics Division and our relationship with Honeywell to build a significant Consumer Electronics presence. To do this, we will combine the Honeywell name along with our skill in the field.”
“Our Honeywell Brand will be the driving force behind the Honeywell Consumer Electronics Division. Our high end line of Consumer Electronics products will include LCD Monitors, LCD HDTV’s, and Portable Storage, among others. They will be elegantly designed, have the latest technology and will have many new features. This brand will be offered at a fair, yet competitive price.”
Points to Ponder * Honeywell is obviously implementing strategic timing by setting up LCD deals with SOYO and then filing lawsuit against LCD manufacturers. Honeywell has years of LCD experience and huge research and development facilities. * Honeywell spends millions on research and development each year and SOYO is now a direct beneficiary of these efforts. SOYO does not spend on R & D, instead they rely on companies they have relationships with, such as Honeywell, to provide them with the latest developments. * Launch of Honeywell LCD TVs and Monitors should be very high profile and will likely make Headlines. * Honeywell has huge sales and marketing force and SOYO has stated they are working closely with them. There is a good chance that there will be a joint Honeywell-SOYO marketing campaign for the LCD TVs and monitors. * SOYO has stated that they plan an aggressive marketing campaign for the Honeywell products - and Honeywell likely realizes that the TVs and monitors will be their face to the general public - Honeywell has a lot at stake. * SOYO has stated of goal of having Honeywell-SOYO TVs and monitors in homes and businesses worldwide. *These new Honeywell/SOYO TVs will likely set themselves apart from all other TVs on the market with innovative Honeywell state-of-the-art technology. Honeywell technical experts are playing a major role and have likely been waiting for the opportunity to show off some of their new technology for a while. Both companies have clearly stated these will be top of the line TVs. They should be able to make the claim that these TVs are the best in the world for picture clarity (clear, sharp colors and contrast) and quality (reduced glare and wide viewing angles).
*** Possible Key Features (gathering of features from other Honeywell LCD products): * Exceptionally Wide viewing angles for improved readability * Easy to see even in bright sunlight - Sunlight readable reflective LCD * Strikingly clear high definition color * High resolution * High brightness * High contrast ratio * Low response time * Picture-in-picture and video-on-video display * 3D comb filter * De-interlace technology eliminates blurry image captures * Four modes of video input * Inbuilt stereo speakers * Unique inbuilt 12VDC power output for powering a camera * Scratchproof/shatterproof glass ensures safety * Eight-language OSD display * Convenient front-panel controls * Power failure function provides auto turn-on in case of power failure * NTSC / PAL auto-select and Universal power supply * LCD panel rated for 50,000 hours * Unique steel cabinet design * Rack mountable with tilt option * LED backlighting for sharper colors * HDMI digital cable with CURxE Light technology that automatically corrects corrupted HDCP and EDID data that would otherwise degrade high-definition picture and multichannel audio performance. * New Mystery Features Here – brought to you by Honeywell * Honeywell-SOYO TVs should have noticeably clearer pictures in side-to-side comparisons with other TVs in retail stores nationwide. * THE IMPLICATIONS OF THIS DEAL ARE AMAZING – IT’S GOING TO BE EXCITING!!!!
STEP 5: LAUNCH of HONEYWELL-SOYO PRODUCTS ***JUST BEGUN!!!*** +++Oct. 16, 2007+++ SOYO Announces Production of Its First Honeywell Products -- SOYO Inc., an innovative provider of computer and consumer electronics, today announced their first Honeywell branded product: the Honeywell SecuraDrive(tm).
-Next up: Honeywell LCD Computer Monitors by end of year 2007. -Then, the most exciting of all, LCD TVs in early 2008 with confidential, new, innovative features yet to be announced.
Posts: 74 | From: Midwest | Registered: Dec 2003
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