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Message: Just a DigE Minute! - re: Sinkman

Just a DigE Minute! - re: Sinkman

posted on Jun 18, 2005 08:29AM
No, Sinkman should NOT sell and move on. He, like most of us, has held for a VERY long time. But, to a large extent, I think he is right. Recall that just the other day I posted that I didn`t think we`d see anything significant till Oct/Nov. So that would qualify as waiting after the wait for the AMS, right?

1Q06 results will not be that great based on what we know. We know of $1.8M in orders, all of which should be filled before the end of the qtr. (since that was reported on 5/17/05). I believe that these orders are soley for versions of digEplayers, and that there is an approximate 20% margin on such sales. That`s $360K in profit for the qtr, or about half the burn rate. This leaves a shortfall of about $350-400K (since EDIG has added some personnel since the $215K burn rate was reported). That`s where we stand, like it or not. Stealth contracts being worked? Who knows? Big digE order any day now? Who knows again. Either are possible....

One thing to ponder that COULD happen, though the timelines are tight to make it fit a AMS announcement: An order for ethernet/card swipe enabled digEs. We heard of that order on 5/17/05 - about a month ago. Order to delivery time is down to what, 30 days (or is it 45?)? That order was probably for 1,000 units IMO. Did we hear of a new adopter of this version of the device out of Paris? NO. But that would have been an opportune time to announce, right? So what to make of that.... I now suspect, based on thinking this through, that these 1,000 are in trial mode (which would make sense; it`s a new, untried version). So could an airline take delivery, do a trial and make a decision to buy before 8/4/05? Possible IMO, but not likely. Within a couple of months later is much more likely, assuming the trial is successful. Maybe around WAEA time?

Who (which airline)? All we have to do to find out is send someone on every flight of every airline over the next month or so, and we`d know! Pack your bags! LOL

On other fronts, we`ve heard that something may be happening on the Kino/commercial digE front, but that the customer won`t announce till Fall (though an announcement, or permission for EDIG to announce without naming names, could come sooner). This likely puts us in the Oct/Nov timeframe again, right? This does present one wild card - permission for EDIG to announce at the AMS.

So I suspect that there will be a ``wait after the wait`` as Sinkman suggests, unless a digE order of magnitude (!) or something else, comes along in the mean time.

Should I sell and move on? Not bloody likely! I currently have 340,000 shares in ``long term capital gain`` territory. I ain`t goin` anywhere, and I bet Sinkman isn`t either.

While I`m convinced we`re in the digEsystem, I can see where Sinkman is suspicious due to the RP comments.

Comments, opposing opinions, corrections, and any other ``logic`` is solicited.

But keep in mind that....

I KNOW nuttin`!

SGE

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