ALDN

[Garoh]

David are you litening to the Call ?

any thing bad that took this one down ?

thanks

[DragonAMG]

David are you litening to the Call ?

any thing bad that took this one down ?

thanks

Why are we down $1.50???

[berloga]

Profit taking on the good news? ALDN hasn't been all that dynamic in terms of its share price. Perhaps some fish bails out and moves its money into a different stock?

[David Randolph]

I'm listening to the conference call now. There are many technical problems with the sound. I guess the sell off is because they didn't disclose details of the India deal, or because they said the deal won't have a material impact in fiscal 2007, just 2008.

I'll let you now as soon as the call ends, but be cool, fundamentals are supportive. 

[berloga]

There is the following headline at Yahoo!, but I can't find the article.

Today, Thu, Jul 19, 2007
• InPlay: Aladdin Knowledge Systems earnings correction
Briefing.com (Thu 8:18am) 

[David Randolph]

I'm listening to the conference call now. There are many technical problems with the sound. I guess the sell off is because they didn't disclose details of the India deal, or because they said the deal won't have a material impact in fiscal 2007, just 2008.

I'll let you now as soon as the call ends, but be cool, fundamentals are supportive. 

Yeah, they didn't disclose financial details of the India deal and said they'll never break that deal down. They said they won't discuss individual deals or clients, which is contrary to what they said in the past.

They also said the deal is going very well and that they just received the first order. There was no impact from India in Q2 2007 results.

This is probably why we're seeing some disappointment in the share price today, even though the quarter was great.

[JKN]

This is all I found at Briefing.com...

8:18AM Aladdin Knowledge Systems earnings correction (ALDN) 23.05 : Co reported diluted EPS $0.26, a penny below the consensus of $0.27. Earlier we reported the basic EPS number and said that the report was in-line, this was incorrect. We have updated the original comment.

[nexta]

IMO it´s no so bad. There is a lot of swing traders which buy stocks before any earnings and then they go out into another stock what is "before earnings" without any other reason. IMO it is not huge sell-off, we are here after earnings only.

[David Randolph]

There's some discrepancy between the estimates you have and the numbers I see on Yahoo Finance, but I guess your numbers are more accurate which makes me think I should subscribe to something like First Call. Do you know of any better service to get accurate, up to date analysts estimates? Thanks.

Anyway, I still think ALDN went down after the conference call because the company didn't provide details on the Indian deal it announced in April 5, 2007, and said they never will:

• Aladdin Knowledge Systems Wins Deal to Supply Up to 3.8 Million Indian IT Students with eToken Authentication Keys Call scheduled for 8:30 am ET today
CCBN (Thu, Apr 5)

I would say the deal isn't going as well as they initially thought, or else it will take much longer than previously expected. But they did say everything was going fine and they just received the first order from CIITE, so I guess we'll see what happen going forward.

But, even without India ($0 coming from India this quarter), the company achieved 22% revenue growth (my model is calling for 25% revenue CAGR over three years) from the year ago period, so everything seems on track.

ALDN is now trading at roughly 21 times 2007 EPS given by the midpoint of the company's guidance, while companies in its industry trade at an average of 40 times earnings.

I'll continue holding ALDN for the long term.

[David Randolph]

I'm more confident about ALDN now that earnings were released than what I was in the past, because I've seen revenue growth of 22% even without any contribution from the Indian deal. Just 3 percentage points to go to achieve my long term estimate.

I believe investors will start to realize how undervalued ALDN is, trading at 21.6 times 2007 EPS while companies in the Security Software & Services industry trade at 40.82 times EPS (and ALDN is growing more and has higher profit margins than the industry average). 

I'll continue holding ALDN.

[David Randolph]

Another good day for ALDN, proving the people that sold on the earnings news wrong. My latest update says it all in my view:

I believe investors will start to realize how undervalued ALDN is, trading at 21.6 times 2007 EPS while companies in the Security Software & Services industry trade at 40.82 times EPS (and ALDN is growing more and has higher profit margins than the industry average).

[David Randolph]

Nothing new for ALDN today, I'll keep holding the stock.

[David Randolph]

Unfortunately ALDN couldn't surpass the $23 - $24 resistance area and came off a bit on low volume. Fundamentally everything staid the same as there were no news out. I'll continue holding ALDN.

[David Randolph]

ALDN opened down a lot but recovered some ground throughout the session, on volume above average of 231,900 shares. I remain confident about this stock's prospects.

[David Randolph]

Nothing new on ALDN in Friday's session, I'll keep holding.