RAK Rakon

[fredsmith]

Check out the Rakon website www.rakon.co.nz and you will see pictures of what the Oscillators look like. I suppose the easiest way to make a good guess if a product conatains a Rakon part is to look for the 'R' on the top Oscillator.
I have no assoctiation with Rakon but have been the the local electronics industry for about 30 years, 26 of those selling electronic components to the local industry. In those days, Rakon was one of my customers.

[Malj]

Good old Google alerts... this from the NBR (note they must be reading share trader :))

Rakon stays coy on iPhone link
by Fiona Robertson
Tuesday July 15 2008 - 03:02pm

Crystal oscillator manufacturer Rakon is still refusing to be pinned down on whether its components are in the new Apple 3G iPhone released last week.

Tech fanatics have already begun tearing apart the new iPhones and posting the results of their destruction online, with one site naming the GPS chip inside the iPhone as an Infineon product.

But that doesn't rule out Rakon's contribution to the iPhone.
Rakon manufactures oscillating components that are used in GPS devices * so it doesn¹t actually make its own GPS chips.

Rakon marketing manager Justin Maloney said the company's components were compatible with the relevant GPS solutions named online. But he would not elaborate further on whether they were actually used in the iPhone chips, in line with Rakon's 'neither confirm nor deny' policy.

"We respect the right of our clients to keep their secrets, secret," he said. Punters on web forum Sharetrader have also been speculating about Rakon's presence in the iPhone.

[Placebo]

You could explain it to me all night but I still will never understand what the f*ck an "oscillator" is, or what it does.

As far as I'm concerned it's a little electro-doovrie thing that makes machines go `ping' or whatever. A bit like worrying about who makes the valves in my car's engine.

[Footsie]

classic

I knew media and the companies read these sites.....

there is growing evidence around the world that even hedge funds use "plants" on chat sites......


I thought that "fredsmith" person was suspicious.

from my point of view its obvious RAK components are in the iphone.... if you werent in the iphone....then there is nothing to hide so you would deny it.

If you can't confirm or deny something .... that whatever it is ....... is obviously true.

********"We respect the right of our clients to keep their secrets, secret," he said*****

If apple wasnt their client...... then they wouldnt be keeping a secret!!!!!!!!!!!!!

[Malj]

You mean 'plants' who talk up a stock, like saying someone is supplying the iPhone even though the company is sort of not confirming it :-) - just kidding!

I know a bit about electronics and had a good study of a couple of sites that tore some of the new iPhones apart. Best one was a kiwi site here: http://live.ifixit.com/Guide/First-Look/iPhone3G

I looked pretty hard and think I know where the oscillator is for the GPS in the circuit but looks impossible to tell who makes it - at least for me (I was looking for a little shiny thing with an R engraved on the top).

Doesnt make too much difference to me either way, still a Rakon fan despite the hammering they got. I think the new iPhone is great because its a real headline cell phone with GPS built in and even if Rakon aren't supplying it its going to help drive more and more cell phones to have GPS in them too (Google Nokia and GPS to see what they are doing) which has to be good for Rakon, I hope :) ... anyone know if Nokia is a Rakon customer?

[mondograss]

Up 4.7% today on nearly 1.5x average volume, and it's not even 11am yet. Someone's had their weetbix this morning.

[AMR]

http://www.sharetrader.co.nz/picture.php?albumid=5&pictureid=35

Ooh...a double bottom has been confirmed as of yesterday. I'll be waiting for a successful break of $3 to commit to a position, RR not great at the moment.

[Phaedrus]

http://h1.ripway.com/Phaedrus/RAK87.gif

[Footsie]

its definitely a higher low..

looks good

[Bob Marley]

Hey mon
I think RAK's AGM is on this afternoon. Is anyone taking a punt on a favourable profit guidance announcement? They mentioned at the FY08 result back in May that they will be giving profit guidance at the AGM.

What has happened since the FY08 result announcement?
1. NZD/USD has fallen to 65.5c
2. TomTom and Garmin (their two biggest customers) announced ok 2Q results and TomTom maintained their FY volume growth guidance of 50+%.
3. They've announced their Chinese manufacturing plans.
4. Market sentiment remains poor.

From memory, the company have indicated that a 1 cent movement in the NZD/USD impacts EBITDA by nearly $1.5m. They achieved FY08 EBITDA of $23.4m (excl one-offs) at an avg exchange rate of 76c (as stated in their annual rpt). So assume the x-rate averages 66c in FY09 and ignoring volume/price factors, then EBITDA this year should be close to $40m. Taking off say $10m depn, $1m int, and $9m tax gets NPAT of close to $20m or a PE of 18.2x at $2.85.

Has anyone got any negative news or hesitations about RAK?

[ratkin]

Ya mon , every day bucket go a well, one day di bucket bottom mus drop out
Mashin up of one's plans.

Know wat im sayin innit

Da Rasta rat

[Dr_Who]

How easy is it for the Chinese to cop Rakon products and sell similar at 1/3 the price?

[Zaphod]

RAKON LIMITED ASM 11 SEPTEMBER 2008

Addresses by the Chairman and the Managing Director at Rakons' ASM held at
2pm 11 September 2008 are shown below:

Chairman's Address

Welcome to our third Annual Shareholders Meeting it's a pleasure to be able
to address you here today as joint owners of Rakon Ltd.

The results for Rakon's financial year ending March 31st 2008 produced an
EBITDA of $25.4 million i.e. 26% ahead of the previous year; but this, as I
mentioned in the Annual report, was not as good as your Directors would have
liked.

Nevertheless it was still a commendable effort in the face of a persistently
high New Zealand dollar, underperformance from our French operations and
toughening global conditions.

Those Global economic conditions have worsened significantly since this time
last year and will continue to provide a stiff head wind for us for the
remainder of fiscal 2009 and who knows for how far beyond.

Despite these tough markets the team at Rakon is working very hard and making
good progress across most business fronts this year. You will hear more
detail on this from our Managing Director Brent Robinson in a minute.

The New Zealand dollar has very recently retraced a lot of its large gains
against the US dollar of the last 12 months. We are naturally happy about
this, having maintained cover at the low end of our policy range. This means
that we will realize some of this benefit in our immediate financial results
and importantly in the medium term if rates remain, and continue lower this
will provide a significant boost to our earnings for the medium and longer
term.

Remembering that ever 1 cent shift for the full year in the Kiwi Dollar
against the US Dollar has an impact of between $1 and $1.5 million annual
EBITDA for Rakon.

In France we have shifted a significant amount of that production to our new
Joint Venture with Centum Electronics in India. This shift is designed to
achieve similar or higher quality products than previously delivered from
France and at a cost which is significantly lower. Given that it was going to
take time to get the Indian operation up and running properly we didn't
expect instant results but the early signs are very encouraging and will
provide us with the opportunity to grow this business profitably Meantime the
French production efficiency improvements are progressing and are subject to
close and constant review with a goal of having this business providing high
quality R&D and niche, extremely high specification product as a key part of
Rakon's portfolio .

You will recall that our French operations were included in our acquisition
of Frequency Control Products Ltd last year which significantly broadened
Rakon's market penetration and added to our sales and R and D capabilities.
We sold a small non-strategic piece of that business to the management this
year for our book value and pleasingly all the other parts of business are
traveling well with continued strong financial performance from our UK
factory and exciting developments from our engineering team.

So since our last ASM it has been a very busy time at Rakon building a Global
business based upon our strategic footprints.

Those footprints are now largely in place or in the process of being built;
Research and Development in the UK, France and NZ, our flagship high quality,
high volume production facility in NZ, High value and high quality production
facilities in the UK, and France, and High Quality, low cost, high volume
production facilities either operational or being developed in India and
China. The latter two are underpinned by valuable joint ventures and the fact
that they stand at the center of the two largest potential markets in the
world.

We also have a global sales and business development team spread across all
the major markets.

Building and growing a Global business is not an easy task, it takes time
patience and persistence and a lot of travel by the key members of the Team.
Encouraging and maintaining a culture that can maximize the value from our
core assets and our agreed strategic direction is undoubtedly the most
difficult task and one that requires constant personal attention from the
senior members of our Team.

Rakon's strategic direction is very closely aligned with the World's desire
to do every thing faster than before (i.e. the "need for speed" of which I am
sure you are all familiar). To do more in less time people need to use
electronic aids; e.g. GPS, Mobile phones, PDA'S and a host of other wireless
devices or the networks supporting those devices. This constant consumer
demand for enhanced functionality drives the manufacturers of those end
products (e.g. the mobile phone or PND makers) to seek more accuracy which
in turn drives those manufacturers and the network providers to upgrade to
higher spec'd Frequency Control Products that are Rakon's specialization.

Rakon has been and will always be driven to remain at the fore-front of the
highest quality timing synchronization products. With our global spread of R
and D and production we are determined to ensure that we will maintain this
leading edge of quality and always at a competitive price for that quality.

So in summary the last 12 months have not been easy and we are going to have
to work very hard this year to achieve the results we want. Those efforts
won't necessarily bring all of the rewards in this financial year as our
goals are long term; growing the business into a long staying very profitable
global player.

We are confident that we have our strategic direction is right, our
investments required for solid growth in place and our team is now beginning
to perform around the world toward a level that will allow us to maximize the
returns we require.

Everything is beginning to connect wirelessly and we are confident that
worldwide manufacturers of products and networks wanting to take advantage of
this growing "wirelessness" will require Rakon's people and product expertise
to help them solve their problems and stay at the leading edge of their
markets.

Naturally we will have to fight for market share with global competitors but
we are well positioned and emotionally ready to sustain those challenges and
fight for what we want in new and emerging markets.

In closing I would like to thank our team of dedicated people around the
world who work hard to deliver the results your Directors expect, and to you
our shareholders for your continued interest in the business.

Thank you.

I would now like to hand over to our Managing Director Brent Robinson.

Managing Director's Address

Good afternoon and welcome to Rakon's third annual shareholders meeting.

I'll start by making some comments about our current business performance
then move to an update on the growth of GPS and the strategic direction of
Rakon.

As Bryan noted, weakening consumer and commercial markets have impacted our
business in the YTD and we do not see this abating in the near term.

From NZ we now expect sales volume for the current financial year to be
approximately 20% ahead of FY08. We have retained our leading position with
our large customers who are still growing strongly although at a slower rate
than previously expected. Sales growth from our smaller GPS customers is less
robust, pulling the overall growth rate down.

Our UK business is performing very well. This business is centred around the
Pluto based product - its comparative cost and performance is such that
growth continues to be steady into a range of applications. Overall sales
volume in the YTD is slightly up on the same period last year but product mix
is much improved with a higher proportion of Pluto sales delivering higher
than expected earnings. Orders continue to be steady and we expect a good
result for the year.

Our Indian JV is now operational and volume will begin to ramp up as products
are re-qualified from this new facility as required by some of our customers.
By the end of FY09 we expect to have largely completed this process. Most of
the first half production has as planned been manufactured in France but
demand has been below expectations. In some respects this is fortunate as it
has corresponded with the equipment transfer from France to India, but it
does mean aggregate financial results from this business will be below
expectations for FY09.

The recent severe softening in the NZ$ provides a good offset to the slower
than expected markets. As mentioned by Bryan, our recent practice of
maintaining cover at the low end of policy limits mean we have been able to
take the opportunity in recent weeks to increase the near term cover to our
policy midpoints. Accordingly we now have 60% of the balance of FY09 covered
at an average rate of 72 cents.

Broker estimates for Rakon's FY09 result are currently in quite a wide range.
At the EBITDA level the range is NZ$23.5 to NZ$34.4 million. As we have
previously explained movements in the exchange rate impact significantly on
our earnings. Given exchange rates recorded in the YTD,
Rakon's forward cover position on the US$/NZ$ and assuming an average spot
rate of 68 cents for the balance of the year, we expect to realise an average
rate of just over 72 cents for the full year. On this basis and based on our
current assessment of markets we expect FY EBITDA to fall near the middle of
the brokers range and for second half earnings to be stronger than the first.

GPS
Demand for TCXOs used in GPS continues to increase with many applications
still emerging, however with this swelling market also comes increased
competition. Our team in NZ has worked hard to develop new products of
smaller size, lower cost and higher performance at the same time improving
productivity. This has resulted in excellent market retention and has Rakon
well positioned to capture the expected significant increases in future
demand.

Personal Navigation Devices still account for the majority of GPS related
sales and we expect growth in this sector to continue in spite of a weakening
global economy.

We have seen an increasing demand for TCXO's used in GPS enabled cellphones
and now expect this market to grow rapidly over the next 3 years.

Rakon's track record and product roadmap mean we have strong engagement at
many levels with the industry leading manufacturers and chipset manufacturers
to ensure we capture a share of this opportunity.

Beyond personal navigation devices and other traditional uses of GPS, there
are many new and exciting markets emerging such as location based services
for cellular phones, Geotagging pictures and synchronized network timing for
Femtocells. Rakon is investing significant time into these opportunities as
we consider these GPS applications will all help generate demand for our NZ
business for many years to come.

Strategic Position
Since listing Rakon has significantly broadened its product range and
markets. In addition to our leading position in GPS developed over many
years, we now are well positioned in telecom infrastructure, aerospace and
emerging wireless markets. We have further strengthened our manufacturing
capability here in NZ as well as expanding it globally.

Our UK operation with its advanced design facility and manufacturing plant is
capturing the majority of the emerging femtocell market. This market is
expected to grow strongly over the next three years. Rakon UK is also
benefitting from the growing demand of high specification TCXO's required for
emergency location, military and aerospace applications.

Our JV in India with Centum Electronic marks an important step in our bid to
become the world leading supplier of Frequency Control Products into the
Telecom infrastructure market.

The French operation will continue to design and develop world-leading
Oven Controlled Crystal Oscillators (or OCXOs). They will also continue to
manufacture high specification SC crystals and very high specification
OCXO's used in military and space applications. The lower specification,
higher volume OCXO's will be manufactured in India. The platform we have
established in India provides us with not only a low cost manufacturing
environment but also access to a massive growing market and a new resource of
skilled engineers so that we can continue to expand our portfolio of products
and grow the business significantly and profitably.

As previously noted we expect demand for our GPS related products to grow
significantly, obviously this requires increased manufacturing capability and
the need for expansion. Recently we announced the formation of our JV in
China called Rakon Crystal (Shenzhen) Ltd, or RCS with the shareholders of
Timemaker. RCS will specialize in the mass production of high spec TCXO's and
crystals needed for GPS and cellular phones. A fact that has perhaps been
overlooked is that not only have we formed the JV to manufacture high spec
TCXOs and crystals but at the same time we also acquired a 40% share of
Timemaker's existing profitable business.

One of the key elements of a GPS TCXO is what is referred to as the crystal
blank. This is a very small piece of quartz crystal that needs to be
meticulously cut and shaped with exacting precision. This is the most labour
intensive process of making crystals and one that is not easily mastered.
Timemaker are the world's leading quartz crystal blank manufacturer producing
over 50 million blanks per month. They are a proven key supplier to Rakon and
to our competitors.

We are now in the final stages of designing a new manufacturing facility in
Shenzhen that will house both RCS and Timemaker. This facility should be
complete and in production by the end of next year.

The JV approach into India and China has allowed Rakon to move with speed
into some of the most rapidly growing regions and markets in the world. This
coupled with our outstanding IP and innovation from NZ, UK and France
positions Rakon exceptionally well to service these opportunities.

Thank you Ladies and Gentlemen

Rakon Limited have provided NZX with the Annual Shareholder Meeting 2008
presentation. A copy of the presentation can be requested by e-mailing
lcr@nzx.com

[Bob Marley]

Hey mon
Well I got that one wrong. I thought the falling NZ$ would more than offset any weakening GPS market but it looks like its the other way around. It sounds like price falls in the Personal Navigation Market, extra competition, and slowing demand are hitting them hard.

I managed to get out without too much damage though (in at $2.94 a week prior to the AGM and out immediately after reading the AGM speeches at $2.80).

"..must learn to be more patient mon la la la.."

[Dr_Who]

RAK reminds me of PPL. Once a darling of hte market trading on high PE have fallen out of favour of love.

Rakon profit falls a whopping 66 pc


http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10543027

[winner69]

RAK reminds me of PPL. Once a darling of hte market trading on high PE have fallen out of favour of love.

Rakon profit falls a whopping 66 pc


http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10543027


Even at 130 PE is still in excess of 40 so is still valued for huge growth and all that sort of stuff

Generally once hyped up companies priced for perfection start to disappoint they fall back to the pack (valuation wise at least) and lose that aura once and for all. there are always new sexy companies to get excited about. Consequently I would only see downside on the RAK shareprice over the next year or so and then increases will only be based on actual company performance instaed of what might be.

Pity really but thats how the cookie crumbles ..... had a couple of good rides with RAK since it floated and it was fun while the party lasted

[Nevl]

Actually have just brought some RAK shares now. There was a lot under the result that was not reflected in the net profit including a 15mill jump in positive cashflow. RAK is well situated and they are moving into new areas with good prospects. The new GPS phones will be huge for RAK.

[ratkin]

Wallmart result overnight was interesting . Still very strong demand in the stores for GPS related products, dont know anything about Rakon but cant do them any harm

[Nevl]

yeah i want a GPS phone. probalby with google maps as well. Makes my life so much easier. Waiting for the G phone to get here.

[Footsie]

winner is right

sure there will be the odd rally, but it wont recover until the company profits do

[Cadmium]

I bought a few of these at $1.25 today, on the gamble that they will rally a bit next week and then I'll be out again.

I’m just trying to amuse myself with small trades until some discernable positive trends emerge in the market. I could be waiting some time…

[AMR]

Anyone notice the gap down and reasonable decline yesterday, the day before the results were announced? Interesting...

[craic]

Wallmart result overnight was interesting . Still very strong demand in the stores for GPS related products, dont know anything about Rakon but cant do them any harm


Saw somewher that Walmart are up because the US shoppers have gone down market as the economy falters. Good new for the Warehouse?

[Cadmium]

I bought a few of these at $1.25 today, on the gamble that they will rally a bit next week and then I'll be out again…

I sensed vultures circling above and got out today.

I now have a -10c per share reminder not to be an idiot. :o

<Goes back to reading books on the merits of the 30 week MA>

[whatsup]

Still has a pe of over 20 in this market it should be closer to 8-10!!!!!!!!!!!!

[AMR]

Guess this makes the Bulkowski encyclopedia right again. "A dead cat bounce is often followed by another."

[Dr_Who]

RAK also reminds me abit of PVO. Anyone have any research on RAK?

[Crypto Crude]

dr who,
this year I went to a presentation on RAK at a Hamilton Hinden Green Seminar and RAK is an awesome story from its beginnings... A true New Zealand business started from the home garage.... The presentation was good, and there is huge potential but the speaker went so far over time, that there was no time for questions...
I have been weary ever since...
Rakon does have huge potential... The reason why they have not shown good results is because they are technology focused, and pump all the profits back into staying one step ahead of competitors ... They are ahead of the pack with its quartz crystals business... they have a big chunk of the industry and their product goes into all electronic devices...
so they have a bright future it would seem...
One thing for sure is, I dont understand this business... And I dont invest in anything I dont understand (anymore)... hehehhe...
I got into trouble in the resource sector... hehehehe...
Those were fun times eah....
good luck Rakon... Good Luck investors... make sure you understand this business before you invest...
sp could come down alot more it would seem...
:cool:
.^sc

[ratkin]

Problem with these hi tech companies is that even if they produce a great product within a year someone is making something faster and smaller.

Take the following statement as an example

WHERE NEXT?

Mr. Robinson said he was excited at the potential for growth in new emerging
technologies, such as femtocells, which offered great opportunities for Rakon

Firstly how many shareholders know what a femtocell is?
Secondly just because they exist dosent mean it will be Rakon that makes the best ones
Thirdly they will cost a fortune in R and R
and lastly potential is all very well but it dosent pay the bills

[Crypto Crude]

Ratkin-Problem with these hi tech companies is that even if they produce a great product within a year someone is making something faster and smaller.

That is not entirely true in this situation ratkin...
Rakon (not ratkin), acts as the dominant firm.. the shot caller...
They are ahead of the competition... the bad thing about this is--> all the competitiors need to do is buy an electronic devise with the upgraded technology in it, and learn the secret...
So the competitiors are about one year behind Rakon...
But then again, I dont understand the business model...
I dont understand if or how Rakon will remain dominant...
so I wont invest...
:cool:
.^sc

[AMR]

If anyone is into hi-tech investments read the book "The Gorilla Game" by Moore. Basically, he says that the next Microsoft or Google or Intel needs to have characteristics such as a "moat" to prevent competition. In Rakon's case, I would guess that they'd have to be the standard setters i.e chip design arcitecture.

Did anyone here buy at $1 and make 50% over the last week?

[warthog]

If anyone is into hi-tech investments read the book "The Gorilla Game" by Moore. Basically, he says that the next Microsoft or Google or Intel needs to have characteristics such as a "moat" to prevent competition. In Rakon's case, I would guess that they'd have to be the standard setters i.e chip design arcitecture.

Did anyone here buy at $1 and make 50% over the last week?

RAK currently at $1.49, with few takers down to $1.45.

Did you notice the 400k that went through at $1?

Selling a holding of that size in this market for even $1.40 is harder than it may appear.

[macduffy]

It's just a thinly traded small stock in a very nervous market.

May be someone's great opportunity some day, but not just now!

;)

[kiwi_on_OE]

Most unlucky with the timing of your comment macduffy - 'May be someone's great opportunity some day, but not just now!'.

Closing price 3/3 low 60s. Closing price 5/3 85. 30+% gain in two days. Larger volumes than normal.

Or were you just trying to keep others away so you could load up on the cheap.

[macduffy]

Hi kiwi.

No, no hidden agenda there, I just don't like buying stocks in a downtrend. Too many painfull memories!
I might buy a few if the uptrend is confirmed but very cautiously in this market.

;)

[scamper]

any sign of a response to the 'please explain'?
the asb site only has three identical offerings of the question...

[Xerof]

Scroll down......

[moimoi]

predictably the response was....we are not aware of any information that could explain the movement...

[Balance]

Big seller out of the way. That's why share price bounced. Suspect last of Fisher Funds' shares sold. Buy high, sell low.

[Bob Marley]

Hey mon
RAK's main customer, US-based Garmin, reported overnight. This from Bloomberg:

"Garmin Ltd. had the biggest drop in the Nasdaq-100 Index, falling 15 percent to $21.83. The largest U.S. maker of navigation devices reported sales and profit that trailed analyst estimates, hurt by lower orders for car-focused gadgets."

[buns]

This has been a bouncy stock on the back of little news, as stated above it seems to have been caught up in people (fisher?) reshuffling portfolios and nothing else.

Recently the femto cell proposition has gained traction and has the possibility to really take off – interesting article follows:

http://www.nbr.co.nz/opinion/chris-keall/cell-site-your-living-room-coming-save-vodafone-xt

Anyone else watching RAK?

[ratkin]

Maybe the market has woken up to it , thats why its not going up

[winner69]

AGM tomorrow could be interesting .... wonder why a sudden surge in the shareprice today

First NZ lowered their profit forecasts recently because of the high NZ dollar but rave on about how this femtocell technology is going to be great driver of future profits

Wouldn't rave on about that .... and then subtly include a profit downgrade in the presentation would they ... of course not

[scamper]

Trading halt -- read all about it. expansion in china after a year of pondering, good news i think.

[Snow Leopard]

I just want to clarify something. Would I be able to purchase 100 Shares of Rakon maybe at $1.58 then purchase another 3000 shares through SPP at $1.10? Any help would be appreciated.

Well.

1) As far as I can see the announcement does not give any date for determining eligibility, you may have missed the boat already.

2) I am fairly certain that 100 shares at $1.58 is not a marketable parcel and your broker may well not accept the order.

3) "The placement price is underwritten at NZ$1.10 "
$1.10 is a floor price and in reality the institutions may well pay more and then
"The price of these shares will be the lower of either the institutional placement price, or 2.5% below the average end of day market price of Rakon shares traded on the NZX over the period of five business days immediately prior to the closing date of the SPP."

4) You may get scaled:
"Each holder will be eligible to apply for up to NZ$ 15,000 worth of shares, with applications being scaled if subscriptions exceed NZ$ 20 million. Any scaling of the SPP will be done relative to each shareholder's existing shareholding and the total number of new shares they apply for."



regards
Paper Tiger

[Bob Marley]

Anna

In theory yes you can, but in practice not likely because it is likely to be scaled, and the price is likely to be more than $1.10.

The SPP is capped at $20m and will be scaled if there are oversubscriptions. The scaling is based on: a) how many RAK shares you own, and b) how many shares you apply for.

Note, the record date for the SPP is next Tuesday 29 Sep and the purchase price is likely to be more than $1.10 depending on today's institutional book build. (It is only underwritten at $1.10.)

BM

[Dr_Who]

Who are the brokers?

[Tanger]

I've heard it's UBS.

[Voltaire]

Having lost money on RAK I now only hold a few thousand shares (the loss would have been worse had I not sold the bulk of my holding in the 150's).

Still mulling on the SPP.

Now a puzzle for the conspiracy theorists:

The application form says that a reply-paid envelope was enclosed with the SPP info - it wasn't. Did others receive this? Wondering if this was a one-off glitch or if Computershare are looking to save cash wherever they can (and help to dissuade small-scale holders from bothering them with their applications).

[zigzag]

It was a mistake. I got a letter from Solution Dynamics yesterday with an explanation, an apology and the missing envelope. Yours must still be in the mail.

[COLIN]

Its a Freepost number, so just write it on an ordinary envelope, for goodness sake!
Why am I even bothering to waste my time typing this? There are far bigger issues at stake, like "Do we have confidence in the Rakon expansion plans?" I do, (I think...........?) and have sent off my cheque - although I admit I have been a little bit tempted to sell the existing shares to cover the $15,000 - and to take advantage of the present discount in case it evaporates.

[whatsup]

Dont over look the high $ and pound!!!
Currency can kill a good business and according to the reserve bank they are expecting these ex rates to stay up here for at least 2-3 years!!!

[COLIN]

Dont over look the high $ and pound!!!
Currency can kill a good business and according to the reserve bank they are expecting these ex rates to stay up here for at least 2-3 years!!!

What "high pound"??? Its ages since its been as low as this against our dollar. Your post is more than a little puzzling, Whatsup. Also, I am having difficulty relating it to the decision to set up manufacturing facilities in China, and would be interested in your expanded thoughts on that.

[Voltaire]

Why am I even bothering to waste my time typing this?

A very good question...

You seem to have been a little context-challenged by both my post (next time I'll post an army of ironic smilies to assist) and whatsup's - the sensible interpretation of which contrasts the gaining $NZ and the declining pound.

Anyway, thanks for tackling some of the substantive issues around the Rakon SPP. The main concern I have is re the timeframe for a turnaround in their fortunes and whether now is an good time to be buying more RAK shares. Mobile technology seems to have weathered the recession better than many other areas so in many ways this may come down to how soon the Chinese facility can be brought onstream.

(p.s. you'll all be overjoyed to learn that my reply-paid envelope has arrived)

[whatsup]

Sorry Colin should have read U S $ , but if Rakons products are sold in the U K they get a kicking when they bring the proceeds back to N Z !

[Dr_Who]

What "high pound"??? Its ages since its been as low as this against our dollar. Your post is more than a little puzzling, Whatsup. Also, I am having difficulty relating it to the decision to set up manufacturing facilities in China, and would be interested in your expanded thoughts on that.

Why do they need to build a manufacturing facility in China? Most firms just simple commission an existing firm in China to manufacture the products, so why the need to build one?

[whatsup]

Dr......, May be for security purposes so they cant copy and steel any ideas?

[COLIN]

A very good question...

You seem to have been a little context-challenged by both my post (next time I'll post an army of ironic smilies to assist) and whatsup's - the sensible interpretation of which contrasts the gaining $NZ and the declining pound.

Anyway, thanks for tackling some of the substantive issues around the Rakon SPP. The main concern I have is re the timeframe for a turnaround in their fortunes and whether now is an good time to be buying more RAK shares. Mobile technology seems to have weathered the recession better than many other areas so in many ways this may come down to how soon the Chinese facility can be brought onstream.

(p.s. you'll all be overjoyed to learn that my reply-paid envelope has arrived)

"Context-challenged" eh. I must remember that one.

I agree with your concerns re the timeframe, and will have no hesitation in ditching my shares and moving on to more productive pastures if they spend too long in the doldrums.

[Tanger]

Hi. Has anyone seen the results of the special meeting yesterday. Presumably it was a mere formality to approve the second conditional tranche, but haven't seen confirmation anywhere as yet.

[Nevl]

http://www.sharechat.co.nz/article/05c79417/rakon-poised-to-take-advantage-of-gps-smart-phones.html

Ok if this is not a buy signal I am not sure what is?

"The number of femtocells is projected to grow to 12 million units by 2012, of which Rakon stands to make about US$8 per unit, Walker said"

It seems that the article is suggesting Rakon is up for $80mill per year profit on just this product.

Anyway I am in Rak and expect to see a good rise over the next few years.

[Jay]

Let's hope so Nevl.

Bought some recently a little above where we are now but with a stop loss.
Aslo topped up via the spp.
Seems to be holding at that level (1.15) hopefully a support.

[kizame]

Yep just bought some of these bit above where we are now,great potential,remembering where the price was before things went aury in the markets.
All we need now is for a downtrend in the dollar versus U.S.

[Nevl]

Not a good result but better than expected. Shame they got done on the currency. Maybe they should hire the same hedging advisor as PPL or FPH. Can't see why ttheir predictions could not be fulfilled so will be acquiring on dips I think over the next few months. The statement that they will offer new guidence in early 2010 was interesting as I think they are expecting some good news and this will be confirmation of this.

[tango]

I bought them as part of my long-term growth portfolio. I am a bit nervous about sustained losses but I feel they huge potential upside long-term. I'm prepared to hang in there and reap the rewards in a couple of years

[Nevl]

The Chengdu plant could be very important for them. International media are really talking about this town as the next big thing and all the big high tech companies are locating there so its great that Rakon have their spot. I just hope they have good protection for their IP. Glad that they are doing a lot of research in the UK and France. Try to keep China as a manufacturing base and keep the important info out of the country. Still the femtocells seem like the future especially if JB Were are correct.

[Placebo]

I bought them as part of my long-term growth portfolio. I am a bit nervous about sustained losses but I feel they huge potential upside long-term. I'm prepared to hang in there and reap the rewards in a couple of years

Tango - what does long-term mean? I bought them too but am dead pleased I sold them before I lost too much. As it was I still lost a few quid but still kept me shirt. If I had held on I'd be just hoping...

Hold and hope is really only a strategy if the stock is trending up. What is RAK doing?

[Phaedrus]

I bought RAK as part of my long-term growth portfolio. I'm prepared to hang in there and reap the rewards in a couple of yearsThere is nothing wrong with being a long-term investor, Tango. but you want to make sure that your ideas are not too far out of step with general market sentiment. Remember that the market is always right!

Conservative investors such as yourself often use a 200 day moving average to keep them on the right side of major moves. You can see that such an indicator would have kept you out of RAK for 2 years now - and it has still not signalled an entry. In the meantime, the shareprice has plunged from $5 to $1.20.

Holding downtrending stocks is not a good idea at any time. How low would RAK have to go before you accepted that buying/holding it was a mistake?

http://i602.photobucket.com/albums/tt102/PhaedrusPB/RAK1113.gif

[Silverlight]

Price now $1,10, this below their recent capital raising of $1.15, which was for growth as well not to pay down debt.

Interim report out 18 dec, they did make a loss last year, however balance sheet looks healthy for a growth company.

Assets
C 85m
NC 102m
Total 188m

L
C 30m
NC 3m
Total 34m

NTA is 62.5 cents.

This may be a very good price to start accumulation, however not an expert on the crystal market, and have only read positive commentary on their products.

Any current holders have thoughts?

[percy]

Silverlight,
I have had rakon from day one .
I did not take up more shares as I was unsure of sp direction The sp is below
30day 60 day 120 day and 180 day moving averages.
buying against the trend works out very costly.Also not paying a divy and not likely to for years to come puts a lot of people off.
Hold onto your money untill the trend is your friend.

[COLIN]

Silverlight,
I have had rakon from day one .
I did not take up more shares as I was unsure of sp direction The sp is below
30day 60 day 120 day and 180 day moving averages.
buying against the trend works out very costly.Also not paying a divy and not likely to for years to come puts a lot of people off.
Hold onto your money untill the trend is your friend.

Some good advice there, Percy. I sold all of mine a short time after the SPP, at slightly above the SPP price.
The manufacturing move to China will negatively impact on their figures for a while until they become re-established and move forward.

[Penfold]

Anyone got any ideas why the stock fell today. I feel out of the loop.

Plenty of tech and growth stocks doing ok recently... why not Rakon?

[scamper]

Pretty low volume -- only 108k
Up from its low for the day of 106

rak has been a horror story for more than two years, but with two ok-ish trading movements.
Probably a small holder finally bit the bullet today.
The charts are not good for this share -- balance sheet and strategy may give some comfort, but the trend is not your friend if you are a holder.
As Percy suggests above, hold on to your money. cheers.

[Silverlight]

On a TA basis there is support at $1. It hit this level for 10 days in Nov 08, it eventually broke this level went lower and on the way back up found the $1 level quite resistant for a few weeks, before moving to $1.60.

The current trend is sideways more than down, it hit 1.18 in late September, and only fell to 1.06 yesterday on a single trade.

The liquidity is pretty small at the moment, and a quick look at the depth, shows hardly any buyers, which reflects sentiment but exaggerates the price fall.

Total Bid Price Price Offer Total
9700 9700 1.06 1.08 1162 1162
32961 23261 1.05 1.1 9588 10750
36961 4000 1.04 1.12 20921 31671
46961 10000 1 1.13 10321 41992
59716 12755 0.85 1.14 15243 57235
62716 3000 0.84 1.15 35018 92253
67716 5000 0.83 1.16 4058 96311

[The BOWMAN]

I have to say this is increasingly looking like an insider trading going on. How is the track record of RAK in terms of insider trading behaviour?

[Dr_Who]

Anyone got any ideas why the stock fell today. I feel out of the loop.

Plenty of tech and growth stocks doing ok recently... why not Rakon?

From memory I think a few brokers have a Sell (underweight or whatever you call it) recommendation on it.

[Penfold]

Thanks for your replies... kind of disappointed in the stocks performance. Maybe looking for a good excuse to dump it.

[flyingfox]

Thanks for your replies... kind of disappointed in the stocks performance. Maybe looking for a good excuse to dump it.

i think the price is very attractive, if you dump it just afraid of sp going down further without any other reason, i suggest you not to , especially when there's nothig wrong with the company.
well it's just my view, i want to buy some but still watching...

[Bobcat.]

I agree that this stock is attractive. I like the products, the industry and the management don't seem half bad either.

I've started buying in over the past couple of days. What I noticed when the DOW sunk below 10000 and it took our market down with it, there were quite a few sellers of RAK once it dropped below $1.00. I suspect that these were people with stop losses who had bought either recently on its way down to $1 or last year as the sp rose well above $1.00. Either way, those sellers are beginning to disappear and depth looks good on the bid side. I'm comfortable buying a few more at this price.

Phaedrus - do you mind publishing one of your graphs with a little more TA insight on this one? Thnx.

[Phaedrus]

You sure do like those downtrending stocks, Bobcat! This the same story as TEL. Inexorable downtrend. Falling OBV. RSI giving excellent Sell signals and a string of useless Buy signals. Why don't you wait until there is some sign of a bit of technical strength? Some hint of a turnaround?

http://i602.photobucket.com/albums/tt102/PhaedrusPB/RAK212.gif

[Bobcat.]

I'll be buying some more if this pup breaks through $1.00. Oversold IMHO.
By Tuesday, I'll be either eating my words or sitting pretty - when RAK starts climbing, it rockets.

[ratkin]

I see you have asked for Mr Ps advice and then ignored it !!!

Thing is with rakon , its what i call a trading stock rather than a long term investing stock , and as such it needs to be carefully monitored , just the sort of stock that Mr Ps advice should be listened to

What i call a trading stock is one which isnt easy to value using fundamental analysis. Its very murky , they dont even let on what some of their stuff is used for.
You dont have much to go on apart fromm the price action , and at the moment its telling you to steer clear.

[Bobcat.]

I sold out of this stock @99c (the same price I bought it for) after many sellers appeared @1.00. Looking for another sharp fall before entering again.

Safer still may be to wait for the third dip before buying (a la elliot wave theory) - somewhere in the 80s is my guess. This is not a bad stock and IMHO is oversold, but I am careful not to buy on the way down. Some like to see an established trendline moving upward before jumping on board a safer bet, which is fine, but as for moi, I'd rather be a bottom feeder.

[moimoi]

i'm looking at a very poor quality chart...is the next confirmed support just above the 0.60 mark.?

cheers
Moi

[scamper]

me too -- been that way for a couple of years now.
don't understand bobcat's enthusiasm --
the elliot wave doesn't really show good trades here, imho.
cheers, scamper.

[Dr_Who]

What is stopping the Chinese from copying RAK's IP when they start producing the goods in China?

[Balance]

What is stopping the Chinese from copying RAK's IP when they start producing the goods in China?

Nothing. You can now get the latest iphone from China for US$100. Lasts about 1 year which is good enough as the models keep changing.

The Chinese will have a problem copying Rakon's oscillators for eg however as they are high precision components supplied to the likes of Nokia etc. Hard to see the Nokia's of the world buy Chinese copycat components.

[Silverlight]

5.3m in one trade at 90 cents, & a Price enquiry.

Busy morning.

[Bobcat.]

A heap of bids appearing after that 5m off market trade. I'm in there too, expecting to pick some up in the low 90s. My guess is that we'll see this pup fly today and tomorrow.

[4be]

What are peoples thoughts on Rakons Full year result?

[Silverlight]

Revenue flat, gross down, net loss.

However NTA is up to 86 cents per share, they are growth, so paying 15% over NTA for a growth company is pretty cheap if you rate their product and mgmt.

[Nevl]

What are peoples thoughts on Rakons Full year result?

The result was a bit bland but the outlook was fantastic. Ebita of $25 to $30Mill. Thats pretty good. Will be interesting to see if they deliver. But GPS phones are getting more popular and GPS applications are getting more common not to mention the European Gallileo and Russian systems.

RAK will be a star this year I feel. They are still leading the pack though I am worried about the factory in China. Would not be surprised to see their technology being "borrowed" by the Chinese.

[moimoi]

hmmm....falling thru medium term support on an up day....what gives...?

[flyingfox]

if no news, no reason, no market influence...what else could it be?

[Anna Naum]

Suggest the recent departures of staff from Brook Asset Management means that if/when Brook looses $$$ under management there may be selling in RAK. RAK is one of Brooks biggest overweight bets in NZ.

[Voltaire]

The announcement of the Chinese imperial visit had only the briefest positive impact on the SP - up to 92c briefly - before selling pressure resumed, culminating in a rush for the exit at 5pm (close price 86c). Will be interested to see if there are other notices pending - this Co has a bad record of sustained selling prior to announcements - the obvious inference being that market-sensitive information is not held as tightly as it should be.

Disc. I hold

[winner69]

I see you have asked for Mr Ps advice and then ignored it !!!

Thing is with rakon , its what i call a trading stock rather than a long term investing stock , and as such it needs to be carefully monitored , just the sort of stock that Mr Ps advice should be listened to

What i call a trading stock is one which isnt easy to value using fundamental analysis. Its very murky , they dont even let on what some of their stuff is used for.
You dont have much to go on apart fromm the price action , and at the moment its telling you to steer clear.

Ratkin put this up a few months ago .... one of the better posts on this thread

He is correct ... RAK is a trading stock ... just follow the big trends ... seems little point in holding for the long term/ If you are a believer and want to hold for the long term than the current prce could be a reasonable starting point .... but why not wait for an uptrend to start

As Ratkin suggests not an easy stock to value .... even if the $27m EBITDA came true next year todays price maybe on the cheap side but there are so many ifs and buts.

Definitely one to watch the charts and then do the necessaries.

[Anna Naum]

There will have to be a non cash adjustment for the fall in value of the offshore investments due to amongst other things, the currency and current trading values.

[winner69]

One of the problems I have with RAK is that they are selling heaps of stuff ... $144m last year .... but not generating much cash from those sales (just over a $1m last year)

Previous year cash flows were a bit better but don't seem to be that high for a high tech company with something special ..... rather the margins seem to more like those of an old fashioned maunufacturing company

All the pretty charts in the reports raise high expactations about sales activity but all the hype doen't seem to make sense when you look at what they get out of it at the end of the day

[Anna Naum]

One of the problems I have with RAK is that they are selling heaps of stuff ... $144m last year .... but not generating much cash from those sales (just over a $1m last year)

Previous year cash flows were a bit better but don't seem to be that high for a high tech company with something special ..... rather the margins seem to more like those of an old fashioned maunufacturing company

All the pretty charts in the reports raise high expactations about sales activity but all the hype doen't seem to make sense when you look at what they get out of it at the end of the day

Remember they spent a fair bit on offshore expansion, got to pay some of it with loot.

[winner69]

Remember they spent a fair bit on offshore expansion, got to pay some of it with loot.

Yeah - the cash flows I mentioned were operating cash flows

Investing cash flows have been the $125m they have paid for acquisitions and new plant .... mainly from new shareholder capital

[Anna Naum]

Yeah - the cash flows I mentioned were operating cash flows

Investing cash flows have been the $125m they have paid for acquisitions and new plant .... mainly from new shareholder capital

Gotcha, thanks.

[D_Pick]

Management confirming a $25-30m EBITDA guidance range is very positive in my view.
New product pipeline and access to Tier 1 telecom volumes is also great news.
I'm in around these levels and expecting some uplift in shareprice and a much improved CFO - cash flow from operations this full year.
RAK has turnaround written all over it if they can deliver on EBITDA guidance.

[D_Pick]

Looks like a turnaround is in progress, record unit sales expected this month and volumes more than 60% up on same time last year, share price up around 20% for the month also.

http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10660839

The recent Temex purchase looks to be a good price too.

The sky is the limit.... I mean space is the limit

[Phaedrus]

http://i602.photobucket.com/albums/tt102/PhaedrusPB/RAK728.gif

[COLIN]

Convinced myself a couple of days ago that "the worm had turned" and decided to buy back into RAK. Always reassuring to see Phaedrus' analysis in confirmation of one's decisions.

[Hoop]

Convinced myself a couple of days ago that "the worm had turned" and decided to buy back into RAK. Always reassuring to see Phaedrus' analysis in confirmation of one's decisions.

Yep Colin me too....bought back those shares (+extra) at $1.05 that I sold during the 19 Nov 2007 freefall for $4.50ish...kinda blows a hole in that "buy and hold" theory..eh

[Tanger]

All very positive on the share price front with this company at the moment. It was interesting to see in the Sunday paper that Macquaire had sold some shares recently. I'm looking forward to the AGM to see how 1H 2011 is going.

[kiora]

Maybe one to watch
http://finance.yahoo.com/news/Recession-hits-smartphone-apf-2889563610.html?x=0&sec=topStories&pos=4&asset=&ccode=

[kiora]

Nice breakout ?????

[RRR]

The share price has been inching up without much fuss after hitting 0.89. I do hold a few but not much. Management is very secretive(that is my impression) and don't give much information to the shareholders in their report to shareholders. They should talk less gobbledygook and communicate efficiently to the shareholders. I wouldn't hesitate to sell this dog at an opportune time.

[percy]

The share price has been inching up without much fuss after hitting 0.89. I do hold a few but not much. Management is very secretive(that is my impression) and don't give much information to the shareholders in their report to shareholders. They should talk less gobbledygook and communicate efficiently to the shareholders. I wouldn't hesitate to sell this dog at an opportune time.

I note the SP inching up.Looks to be in a strong uptrend.I went to a presentation where Brent Robinson spoke.His thoughts were very clear and he seemed to know where he wanted to take the company.A good speaker and a live wire,but once he started to talk about their products it was gobbledygook to me,ask I find new technology hard to understand.femoes etc are beyond me.I am happy to hold a few and do not think they will be a boring share to hold,but whether we make a good profit out of them time will tell.A friendly dog to keep in the kennel.

[scamper]

I rather suspect, RRR, that you've been holding much longer than six months.
I don't think anyone who has bought since March would call it a dog.
It's given some worrying moments for sure, but at 120 cps and the chart looking good, I reckon rak is a good buy atm.
I'm too embarrassed to confess how long I've held some of these, but I did buy some more a few weeks ago, and my loss is diminishing nicely...

[RRR]

I bought last Nov for 1.18-so break even today.

[Phaedrus]

Good for you, RRR. There is an object lesson for you there. What did you learn?

[RRR]

The lesson is - don't buy down trending stocks, don't catch the falling knife. Your efforts are much appreciated Mr P and love your charts. Thanks for your time doing this for other investors.

[Tanger]

Still continuing on its merry little way up. Kind of looking forward to the AGM on Friday now!! Let's hope the momentum continues. Hopefully there will be an update on the Chinese operations and some outlook for FY11 in line with their guidance.

[mikew]

Recently Macquaire keeping reduce their holding, i suspect this uptrend is manipulated by them to exit, i know this co. has bad reputation amongst investors, they tapped 65m from investors to build factory in china, what is the progress now?

[kiora]

Macquarire maybe selling but Habour Asset Management and others? are buying ,nice little upkick on solid volume

[D_Pick]

RAK has good tail winds at the moment and the share price is reflecting that.

AGM announcements highlighted the diversification away from being so reliant on consumer products, although with all the new smart phones, sports computers, and navigation devices being released to market one would expect having exposure to the consumer gadget segment may be an additional positive wind for this stock.

[scamper]

Yep, the chart is looking great -- downtrend broken,30 and 90-day crossover etc.
however, am a bit worried about the volumes -- they are not really rising with the sp.
fingers crossed. cheers.

[RRR]

Share price down when the profits are up(from loss)-market behavior is strange indeed. Or may be it it is due to force selling from margin lending accounts due to PRC fiasco. Most of my friends have these special hi tech phones/i pods/ ipads-they look amazing and they can do lots of tricks. I am the odd one in the group-$75 phone with no camera. Time to buy but what? Phone or the share??

[mikew]

This is a family controlled company, they use profit to reinvestment, never ever have dividend before, and will not have in the future, as some analyst forecast some orders will be cancelled due to overheat mobile market, plus high nz dollar, they will not meet the 2011 outlook.

[ob1kinobi]

Recently Macquaire keeping reduce their holding, i suspect this uptrend is manipulated by them to exit, i know this co. has bad reputation amongst investors, they tapped 65m from investors to build factory in china, what is the progress now?

Looks like you were on the money with that comment, Harbour Asset Management have now reduced there holding too.
There's not enough market interest in this stock, I suspect the price will continue to drift lower

[Tanger]

Hasn't Harbour Asset Management increased their holding? (from 5.79% to 6.92%)

[mikew]

Looks like you were on the money with that comment, Harbour Asset Management have now reduced there holding too.
There's not enough market interest in this stock, I suspect the price will continue to drift lower

bailed at 1.30:)

[ob1kinobi]

Hasn't Harbour Asset Management increased their holding? (from 5.79% to 6.92%)

Right you are

[winner69]

Hasn't Harbour Asset Management increased their holding? (from 5.79% to 6.92%)

Aren't these the same dudes who have taken 10% of Wellington Drive

[ob1kinobi]

Looks like someone has begun accumulating below $1.20 ?

[Phaedrus]

There is no technical evidence to support that view, Obi. In fact, the Accumulation/Distribution indicator shows that, overall, RAK continues to be distributed, rather than accumulated. The actions of any big player getting in or out show as "steps" in this plot and I have circled the major ones in Red (getting out) and green (getting in).

One noteworthy aspect of this chart is the accuracy and timeliness of the RSI divergences. Whenever they occured here, without exception they marked significant turning points. Note, though, that you cannot count on their presence - see how there was no divergence accompanying the major reversal in March 2009.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/RAK1214.gif

[ob1kinobi]

Hi Phaedrus, my evidence was simply that volume has been increasing over the past four days with little movement in the SP.

I don't know about a big player but the vol has been increasing.

My technical defns aren't very precise I'm afraid

[Snow Leopard]

There is no technical evidence to support that view, Obi. In fact, the Accumulation/Distribution indicator shows that, overall, RAK continues to be distributed, rather than accumulated. The actions of any big player getting in or out show as "steps" in this plot and I have circled the major ones in Red (getting out) and green (getting in).

One noteworthy aspect of this chart is the accuracy and timeliness of the RSI divergences. Whenever they occured here, without exception they marked significant turning points. Note, though, that you cannot count on their presence - see how there was no divergence accompanying the major reversal in March 2009.

[image omitted]


Should any of you have a few spare days over the Christmas holidays and want something to read then I can recommend both
Fooled by Randomness by N. N. Taleb
and
The (Mis)Behaviour of Markets by B. B. Mandelbrot


best wishes
Paper Tiger

[ob1kinobi]

Thanks PT always something else to read eh. Randomness, yep highly likely.

[ratkin]

Todays news looks to be rather significant, although i notice no mention regards profits

[scamper]

somebody seems to know something -- or maybe they have just had a fortnight to digest the news.
the depth is terrific (for rak): about 75k buyers at 117 and above and only about a handful of sellers from 122--128.
The chart is good, although still a little volatile: downtrend broken, sp up through both the 30- and 90-day moving averages.
This definitely looks like a hold, and probably a buy for the brave.
scamper holds.
ps scamper the beloved dog died and scamper the person devastated. but i now have another pound dog called mini-minor...

[evander]

Yes RAK a hold for me. R.I.P. Scamper

[ratkin]

I sold out of Rakon today , however im not sure i did the right thing , as my system was yet to give a signal. Im thinking it was ok but would thoughts of any of you crayon merchants

Reasons for selling are basically the bearish candles which show up at the risistance levels
combined with overall bearish tone of market.

Note how many times the stock has been ner the resistance levels. Having sold i will now wait for either
pull back , or a smash through the resistance before buying back in. Thoughts

3351

[scamper]

good gracious!
I've just sold a chunk likewise.
but i was so uncertain that am still holding some.
some rabbits deserve to get run over...
The 2-year chart still looks crappy, and the rise from last July (when i bought the small chunk) looks to be running out of steam.
I'll be watching to see if it drops back and there is the possibility of catching another little wave.
Scamper's history with rak is too embarrassing to confess, but it still owes me heaps... Cheers.

[moimoi]

Hmmm...you both sold on an overall down day for the market while RAk stayed steady. I would of thought that signalled reasonably strong support for RAK?

Isn't its little uptrend still intact?

[scamper]

Yes, the little uptrend is still there moimoi.
i sold this morning, and obviously didn't know that rak would stay steady, but probably wouldn't have made much difference...
just smelled a 'fish' in the breeze (didn't want ratkin to feel slighted), and thought those who've made 25% in the last month may grab the profit.
still holding some -- too many really...

[KJ]

Have bought some in the last month & will look to buy more.Improving sales & profit (I hope) and positive comments coming from the coy.Should know more next mth when they report results.

[scamper]

wow, kj
you mean you've made 25% in the last month and are brave as well?!
This share has been a long-term disappointment for me, and i can't seem to think past small trades to minimise the overall loss...
Cheers to the brave!

[KJ]

wow, kj
you mean you've made 25% in the last month and are brave as well?!
This share has been a long-term disappointment for me, and i can't seem to think past small trades to minimise the overall loss...
Cheers to the brave!

No Scamper-I paid $1.07 so not much gain for me.Feel it should do OK over the next year or 2.Time will tell.

[ratkin]

Once again the stock has bounced off the upper trendline , looked as if it as going to smash through , however didnt follow through with the move.


3361

[biology12]

Hey guys,

first comment, been following rakon a bit, ive got a few g to through around. thinking of jumping in before the profit release next week?
i like rakon, and it seems they are doing really well with all the awards they have won. any thoughts on movements would be great.

graham

[Catalyst]

Hi Graham

Here are my 2 cents...

We're obviously interested in 1) what the FY11 profit will be; and 2) profit guidance for FY12.

1. The company said in Nov 2010 that they are comfortable with broker analyst consensus of FY11 EBITDA between $25-$30m. That was when the NZD/USD was about 76c and it probably averaged that for the remainder of the FY. Here are my rough calculations...

EBITDA = $30.0m (lets take the top of that range)
- D&A = $13.0m (double the half year figures, including share-based payments, plus a bit)
- I&T = $ 4.5m (vs $1.8m in first half, but not full tax rate so bit of a guess)
NPAT = $12.5m

PE = $1.24 / ($12.5m/190.2m) = 18.9x
EV/EBITDA = ($1.24 x 190.2m - $10m net cash) / $30m = 7.5x (estimate of current net cash position)

Not demanding multiples for a growth stock, if you assume RAK can grow it's earnings from here.

2. I would be surprised if RAK gave FY12 guidance, given the volatility of the exchange rates. I don't think they have too much hedging in place for FY12 but we'll find out next week. We also know that for every 1c movement in the NZD/USD FY EBITDA is impacted by about $1.5m (company comment last year which may have changed).

My conclusion - There's too many variables for my liking to be confident about RAK's earnings, particularly around exchange rates and hedging. A NZD/USD rate of above 79c must be hurting them a bit. I'd prefer to wait until the NZD/USD starts trending down.

[Catalyst]

The FY11 result appears to be at the bottom end of expectations with EBITDA at $24.8m vs guidance of $25-30m. Not surprisingly, no guidance for the new year (other than it's started well). I suspect currency is still a major head wind.

EBITDA = $24.8m (bottom end of range)
- D&A = $12.6m (about double the half year figures)
- I&T = $ 3.7m (vs $1.8m in first half)
NPAT = $ 8.5m

Multiples look a bit stretched now...

PE = $1.24 / ($8.5m/190.2m) = 27.8x
EV/EBITDA = ($1.24 x 190.2m - $3m net cash) / $24.8m = 9.4x

[Master98]

After china factory opening, they will pour more money in before profitable, so I am sure there will be a cash issure soon. Will RAKON reborn?

[moimoi]

Is a base forming around the low to mid 80's...?

Opinions?

[Catalyst]

Is a base forming around the low to mid 80's...?

Maybe...but I can't see any evidence of anyone accumulating with any conviction. I think the market is more worried about further weakness in the USD which would obviously hurt exporters such as RAK, FPH...

[Alz99]

did anyone attend the annual meeting?

any comments?

[RazorX]

Price now at 73 cents - it will be interesting to see if this one continues down or finds support here. The Reuters option on DB has them as a hold with an annual predicted growth of 42.4% - that would put the SP at about $1 in a year.... provided it broke it's current down trend. I also note that the NZD/USD is starting to go down from its high of 88 cents. Currently around 82 cents with predictions suggesting 77 cents looks realistic.

[moimoi]

Alz, i'd be interested in any answers to your query also.

It looks as tho my own recent recent question above re: forming a base, has been answered in the negative.

I actually thought the wording of the MD and Chairman's addresses were some of the best i had read from a company management in years.

Clearly the company is going great guns....revenue up 30%!! There would be very few NZ companies (not many, if any) that could claim the same.

But that is one solid downtrend currently...

A couple of observations....

- I wonder if a Japanese suitor wasn't running a slide rule over the company given current yen strength.

- When one see's the absolute gushing over Apple on CNBC over the past 6 months you wonder if market cap might be 4 X what it is now if it were listed on the Nasdaq.

just my humble thoughts.

[Felix]

You have to think that with the company at a market cap of $138m, surely the share price can't fall much further given their revenue growth profile and positive earnings. Everything seems to be going really well for the company other than the abnormally high currency.

There seems to be a reasonable amount of buy depth at the 69c-72c mark so hopefully the share price finds good support at the current level.

Don't own the shares myself but I'm taking a good look at the company.

[moimoi]

WOW!!!...

Blew thru the prop buy order that sat there yesterday at 0.69 to end on the low at 0.67 on a market up day.(with DOW up 4 days, albeit it meekly, in succession)

Vendors; could you not of fronted up and bought AMP's shares off market 6 weeks ago.????

[Titus]

Maybe there would be more hype and publicity if it had a NASDAQ listing, but I don't think you can compare Rakon against Apple. Apple is in the business of 'brands' whereas Rakon is just another anonymous maker of electronic bits. I think their best chances will be that some large company takes interest in buying them out. Looking at their 5 year chart it's just one long descent. You'd have to have a fair bit of doubt in their ability to get back on top based on performance so far. And I doubt the NZ dollar is necessarily going to have a dramatic drop in value against the US anytime soon to help alleviate the pressure.

[winner69]

Maybe there would be more hype and publicity if it had a NASDAQ listing, but I don't think you can compare Rakon against Apple. Apple is in the business of 'brands' whereas Rakon is just another anonymous maker of electronic bits. I think their best chances will be that some large company takes interest in buying them out. Looking at their 5 year chart it's just one long descent. You'd have to have a fair bit of doubt in their ability to get back on top based on performance so far. And I doubt the NZ dollar is necessarily going to have a dramatic drop in value against the US anytime soon to help alleviate the pressure.

A bit like WDT maybe?

You said it ... Rakon an another anonymous maker of electronic bits and WDT a make of a so called green engine ... one at least profitable and one not but both have heaps of potential which will be realsied one day ... so they say

Did you read Gaynors take on RAK the other day .. governance a big issue

[moimoi]

Maybe there would be more hype and publicity if it had a NASDAQ listing, but I don't think you can compare Rakon against Apple. Apple is in the business of 'brands' whereas Rakon is just another anonymous maker of electronic bits. I think their best chances will be that some large company takes interest in buying them out. Looking at their 5 year chart it's just one long descent. You'd have to have a fair bit of doubt in their ability to get back on top based on performance so far. And I doubt the NZ dollar is necessarily going to have a dramatic drop in value against the US anytime soon to help alleviate the pressure.

My reference to Apple was more along the lines that some of the "anonymous maker(s) of electronic bits " that are supplying to Apple have been getting pops in market value according to some wittering i had seen on CNBC in recent times. And i think RAK have given plenty of clues they are supplying components for Apple....

[RRR]

Those buying now would be betting on stronger US dollar in the future:scared:. The management is not inspiring either - over promise and under deliver and blame the strong currency. Now they have a good reason for under delivering!

[RazorX]

Just looking at the charts - the SP has been sitting at 65 for a few days now as opposed to it's steady plunge. Watching to see if this is support or whether the SP is 'resting' before continuing it's southward March. Any TA folks out there have an analysis?

[Hoop]

Just looking at the charts - the SP has been sitting at 65 for a few days now as opposed to it's steady plunge. Watching to see if this is support or whether the SP is 'resting' before continuing it's southward March. Any TA folks out there have an analysis?

Hi RaxorX....RRR sort of nails it with the quote "....The management is not inspiring either - over promise and under deliver and blame the strong currency..."

On face value currency seems to play an important role within RAK product management...but...as you see on the 5 year chart there's no simple correlation...maybe the currency hedging strategies used are masking a correlation..who knows???....

However some things we do know from the chart are..
.....Be careful as to don't entirely rely on the drop of the NZ$ to kick start an uptrend.
.....It tested its GFC (March 3 2009) low of 62/63 (primary Support) recently and succeeded so far.
.....No buy signals yet (as of 23 Sept) and I doubt any would be triggered on Monday yesterdays 67 close.
.....As a share from an investors point of view ..it has been in a primary downtrend during the last Bull market cycle....Not a good sign..eh? A devoted loyal holder would have had a huge opportunity loss over this period of time.
.....A risk/reward strategy could be to buy and hope for a 62c bottom but have stops at 60c....Its a volatile share and has been behaving badly so if support breaks getting out at 60 could be a problem.....nah too risky for me ...rather wait for the eventual turn around then decide
.....From the media's point of view its a a glamour puss business model......from a Chartist point of view its a mangy flea bitten mutt
.....It is a volatile share ...when (if) it does spark the past tells us it may be sudden ditto for its falls...so its the quick or the dead...pre-emptive buying and holding in wait for that sudden burst hasn't been a good idea in the past.
.....A tricky share as it isn't very TA friendly the smart money entering around the Autumn 2010 and the increase in buying volume didn't amount to much..However trendlines together with several indicators increases the reliability...one or two indicators used in isolation not recommended.




http://www.imageurlhost.com/images/rie7s6759sqf8cevrev4.png

[RazorX]

Hi Hoop

Thanks for that - gives me some things to think about.

Some interesting points: SP going up today. Also the depth has changed dramatcially. Last time I checked the sellers were asking prices lower than the buyers. Now the lowest ask is 69 cents and goes all the way up to $1.20. (Maybe due to a whole lot of folks buying in at 65 odd and now putting in a sell?) Also NZDUSD still dropping so maybe perking up long term investors?

My strategy is to wait until the price crosses through the 30 SMA, RSI goes above 50, and OBV is rising above 0. Target buying price 75, sell between $1 and $1.20. Sell will be triggered by a cross back through the 30 day SMA. And note to self: As Hoop said its the quick or the dead. Based on the charts and oportunities over the last 2 years you had to be in within 10 days of the initial burst to make anything from it.

[moimoi]

Rakon CEO, Brent Robinson presented at the Macquarie Technology Day in
Auckland on 20 October 2011. A copy of the presentation is attached and will
also be made available on Rakon's website.
End CA:00215372 For:RAK Type:ADDRESS Time:2011-10-25 10:29:11

Has anyone found this anywhere? I can't see it on their website...

[Grantas]

https://www.nzx.com/files/attachments/148021.pdf

[moimoi]

thank you. :-)

[RRR]

Thanks Grantas. As usual lot of gobbledegook and no mention of how they are going to make money from the big towers of growth they are showing in that presentation. They are better off not guesstimating it because they have got it wrong right from the start - have they said how much money they are going to make by 2015?

Rakon is not a high margin technology company, they are just a high cost manufacturing company at the mercy of big boys in technology.

Rakon is the smallest share in my portfolio and getting smaller.

[winner69]

Is that a 5 in front of the RAK shareprice I see .... how the mighty have fallen ..... and the NZD is down heaps as well

Where's whatsup when we need him

[winner69]

Chalkie has a go at Rakon today
http://www.stuff.co.nz/business/industries/6058199/Chalkie-Rakons-share-price-letdown

Starts with If Rakon had achieved about a tenth of the things its investors hoped for a few years ago then it would probably now be operating from the moon and selling products throughout the Milky Way. Such were the stratospheric expectations but sums it all up when he points out what is generally overlooked - Rakon is a mere component supplier and always exposed to market pressures

Seems to be sommon threads with other recent disasters-all the brains in the Boardroom don't seem to be able to manage fores .... and hell that name Mogridge seems to pop up again

[Halebop]

I don't think being a component manufacturer alone is the core of the issue. Intel made a success of this in the 90's by achieving scale and promoting brand (the very successful 'Intel Inside' campaign).

As an investor I'm particularly turned off by the capital intensity... although Chalkie is correct to highlight their inability to profitably navigate cycles (the later arguably linked to lack of branding and pricing power). Assuming they are nothing more than a capital intensive cyclical manufacturer of widgets then they probably deserve a low market rating.

Disclosure: Not a fan

[Hoop]

This high tech product provider is suffering a similar fact as others.
I nearly bought into Corning Glass sometime back when Samsung bought 60% of the company.
Corning Glass was just a glass company once but with a future visionist management combined with a large R&D Department they started to produce Hi Tech glass....

Now with a company supplying Samsung with very thin very strong panel glass how could they not succeed....also PLEASE watch this video (http://www.youtube.com/watch?v=6Cf7IL_eZ38) by Corning Glass.........you will be absolutely BLOWN AWAY and note that all this futuristic looking High tech glass technology is in prototype form at this present time!!!!!! .

After this video blows you away with that futuristic look...and before you stampede into buying these Yankee shares look at today's shock announcement by Corning Glass...http://www.reuters.com/article/2011/11/29/us-corning-idUSTRE7AS1ZO20111129

Now relate the two companies Rakon and Corning Glass......she's a tough (gorilla glass tough..eh) high tech product market out there ...ehhh

Disc: No shares in RAK atm..... sold out Nov 2007 at 448c for a 10% loss... sold out July 2009 148 for another 10% loss... sold out in Nov 2010 for a 10% profit...yay got it right at last :p

[Toasty]

Is that a 5 in front of the RAK shareprice I see ....

Was that a 4 in front of the RAK shareprice today. Is there no end to the freefall?

[stevo1]

Looks to be heading for penny dreadful territory .

Was that a 4 in front of the RAK shareprice today. Is there no end to the freefall?

[stevo1]

What a great reason not to invest in the NZ sharemarket.
At its peak had a market cap of $1,088,919,968 now $84 million.
An incredible destruction of wealth and expectations.
Have been watching this tech wreck with morbid facination and wonder that something that seemed to look so right can have been so badly stuffed up.
Management need to address some serious issues here.
Shareholders should be well p d off.
Having said all of that I am almost tempted to put my toes into the water.
but shareprice would certainly indicate that RAK is heading towards the knackers yard

[Master98]

This company have some major problems:
. very bad management from boardroom to production team;
. very high production cost(waste);
. fallling customer orders( high competition markets?);
. china factory just like a black hole needs more funds before enter into real production run( now still in test run).
. high NZ dollar?

[Catalyst]

At its peak had a market cap of $1,088,919,968 now $84 million.
An incredible destruction of wealth and expectations.

Market cap at 2007 peak was about $740m (only 127m shares on issue then) but still a massive decline. Trying to think of a catalyst to rerate this one.... maybe drop in NZD, change in mgt/board, or simply a rebound from oversold levels?

[stevo1]

Market cap at 2007 peak was about $740m (only 127m shares on issue then) but still a massive decline. Trying to think of a catalyst to rerate this one.... maybe drop in NZD, change in mgt/board, or simply a rebound from oversold levels?

Sorry about that Catalyst I just took the number of shares on issue and multiplied it by peak price (lazy research).
Could interest someone as a takeover but solely dependent on the Robinson stake being relinquished which seems unlikely.
this article from the herald has brokers warning clients off it?????
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10771814
Pretty unusual in my experience of brokers- they may have an agenda in doing so .
Master98 you seem to have working knowledge of RAK.
Seems to be a bit of depth coming into buy side ATM.

[Master98]

Master98 you seem to have working knowledge of RAK.

I have no working experience in RAK, but i was RAK shareholder since 2006, had some good time pre 2008 and bad time after end of 2009, especially after SPP.

[moimoi]

Hmmm...Up 10%, on an overall down day, on roughly triple the recent daily volume......

I thought something was up yesterday mid afternoon, when IMO a buy bot was put to work.

[Jaa]

The very defensive interim report released today had some interesting bits:



Directors have been buying.

Chinese factory is now operational, 100,000 units shipped in November with 5m a month early next year. The factory is across the road from the largest consumer manufacturing facility in the world run by Foxconn (maker of iPhones, iPads and many other things). This is either a big hint or big tease!

Investment in R&D has resulted in lots of new products and contracts about to come on stream.

The recent share price fall was in part caused by "one or 2 institutions were readjusting their “book” to de-risk from certain equities and move more into cash and bonds in these uncertain times"

The company has had a period of significant negative operating and net cashflows and now only has about $5m left in cash. Non-current liabilities have also increased.


So what do others think? Turnaround in the making or more of the same?

[stoploss]

What I can't understand is they say they are in all these "smart devices " "market leader " etc, etc, well ffs , Apple have sold how many 10's of millions of Ipads and Iphones over the past year. If they were in these surely the share price would have gone North at some stage in the past 2 years...Time they fessed up who exactly is buying their product instead of maybe misleading investors/the market.

[skydog]

Stoploss: Sentiment for this stock seems very high. Look how many picked this stock for the 2012 stock picking contest. Out of 111 entries, 27 picked RAK. Then again this competition doesn’t need any cash up front.

Maybe they don’t want to disclose who they are selling products to, as maybe there’s some ethical issue at play. I remember reading a few years back, there was rumors RAK were selling products that were used by the military. What type of 'smart devices' are they talking about? With the current strength of the green party in NZ it might not go down too well, if their clients are known. Just a thought.

P.s I hold RAK and also picked it in the 2012 comp.

[stoploss]

lol skydog I have it in my picks .....thinking it is ripe for somebody to have a crack at it, they would get it at a bargain price compared to a couple of years ago ...still wouldn't help those long from the cash issue over $ 5.00 !!!! .They confirmed they sold chips to the military that used them in smart weapons.However my point is and others have alluded to this on here they keep saying they are a market leader in this technology.....look how many smartphones have sold just in the past year...(apple have sold over 120 mio iphones in the past few years )If they were in this space their profit and the share price should be riding as high as the "sentiment ".
ps:RAK is/was responsible for my biggest trading loss.

[stevo1]

RAK seems to be getting a bit of volume behind the buy side and a little lift in SP

[Jaa]

They confirmed they sold chips to the military that used them in smart weapons.However my point is and others have alluded to this on here they keep saying they are a market leader in this technology.....look how many smartphones have sold just in the past year...(apple have sold over 120 mio iphones in the past few years )If they were in this space their profit and the share price should be riding as high as the "sentiment ".

I will have a go at answering this as I think it is the key to the Rakon enigma.

From what I can research on Rakon they are very good at making some of it not the best (especially after the French acquisition) frequency control devices in the world. Now for cruise missiles you need very good control or your missile misses the target or ends up in the wrong country! Likewise for space and commercial telecommunications applications.

For smart phones you are more concerned about the price/value trade off and thus all but the top models probably use frequency control technology a few years behind to save some money. If your GPS location is off by a street its no biggie. Apple with its insistence on quality hardware might be an exception to this.

This is the problem the Chinese factory was built to solve, giving Rakon product at more price points in the market. As its ramping up production now we will soon know if this strategy has been successful. Watch for % of sales to smart phones to increase.

[Jaa]

We won't know if they are supplying Apple. Most Apple components are bought through FoxConn or Pegatron, the manufacturing companies for apple products, and even then, those relationships are a closely guarded secret in terms of numbers.

FoxConn's largest factory is across the road from Rakon's new Chinese factory.

[stevo1]

We won't know if they are supplying Apple. Most Apple components are bought through FoxConn or Pegatron, the manufacturing companies for apple products, and even then, those relationships are a closely guarded secret in terms of numbers.

With the current the way it is, RAK are price takers, not price makers. Their goods aren't special enough from what I see to command a premium, and the currency wreaks havoc with their ability to undercut or enjoy good margins if their goods are unique.

Hi sparky my understanding of the RAK factory in Chengdu is that it is located in close proximity to Foxconn Apple factory.There is great secrecy surrounding Apple production etc.But by implication (production of 5mill units/month from 100000 at present) it would seem logical that they are going into apple phones and i pads
http://micgadget.com/12674/the-inside-story-of-the-new-foxconns-chengdu-factory/

[corlemar]

It seems the directors buys prior to Christmas could pay dividends.....30% + return since !

[moimoi]

and good on them for fronting up!!!

Its a funny old caper tho, hard to really know what has changed since December?

Pretty major lift in market sentiment offshore, Apple smashing the cover off it yesterday possibly helps the vibe, but then the NZ$ is still up...go figure.

Sell side depth looks thinner than their profit margin :-)

[golden city]

it seem to be demand comming.., someone is taking a possession or there might be good news comming?any thought on that?

[moimoi]

Rather a long bow...but who knows....the below from an article on Apples earnings....

""The company has accumulated $97.6 billion in cash and investments, money it's "actively" discussing how to use, chief financial officer Peter Oppenheimer said. That could include supply-chain investments, acquisitions or other expenditures, he said.""

http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10781118

[golden city]

it looks like a takeover offer comming by the speed of shareprice leap

[stevo1]

Rather a long bow...but who knows....the below from an article on Apples earnings....

""The company has accumulated $97.6 billion in cash and investments, money it's "actively" discussing how to use, chief financial officer Peter Oppenheimer said. That could include supply-chain investments, acquisitions or other expenditures, he said.""

http://www.nzherald.co.nz/technology/news/article.cfm?c_id=5&objectid=10781118

It is rather a long bow moimoi and unless the Robinsons sell damded unlikely,but then again never say never.I bought in at 44 so not unhappy with the way the SP (65 atm) is going.Now that the Chinese factory is open figure that this is the year they will make it or break it.They seem to have the critical mass with production and certainly have world leading technical expertise.Time will tell

[golden city]

yes..let's see., when u look it the exchange rate..it is unrealistic to expecting any underline result improvements....so....hard to say this one

[winner69]

You guys have to stop raving on about RAK and making these suggestions that RAK are prime for a takeover and that they are selling heaps ..... it just cause poor old Bryan pain on a long weekend being rung up by the NZX to check they are keeping the market fully informed

But then again AMP would say thank you very much taking their excess shares of their hands

[stevo1]

so true, how poeple have short memories, this stock has always done well on hype and speculation, only to be dissappointed by reality, thanks to who ever bought my shares at 68 cents on friday. I believe the true worth of rakon shares is 25- 35 cents, this will be proved when they come to the market place for more money and more speculative grand statements. They will also blame the $ for much of their problems '' yeh right''
Hi snapiti the fact is that NOW RAK have in place the Chinese factory PlUS the technology bought with their other acqusitions.IF they do disappoint now market WILL kick the S%#t out of the SP,although it has had a fair old kicking up to now,The thing is the SP has been rising on volume,so while AMP may be selling who is buying?Certainly today the SP has faltered slightly on low volume.Query from NZX on SP rise maybe due to sharetrader talk (yeah right).Time RAK delivered the goods

[moimoi]

Well done on your purchase Stevo. :-)

I doubt AMP (or Harbour Asset Management) is still selling. i suspect that it would not have had the recent run with a large seller in the market. In fact i suspect its the opposite.

No doubt the response to the speeding ticket tomorrow will be adequately non illuminating.

I wonder if we will be offered the ""one or 2 institutions were readjusting their "book" to re-risk from cash to certain equities"... lol.

[Toulouse - Luzern]

Hi Snapiti,
I used to own RAK.
Looked at the records and was in at 480 and out at 531 in 2007...

[winner69]

Well done on your purchase Stevo. :-)

I doubt AMP (or Harbour Asset Management) is still selling. i suspect that it would not have had the recent run with a large seller in the market. In fact i suspect its the opposite.

No doubt the response to the speeding ticket tomorrow will be adequately non illuminating.

I wonder if we will be offered the ""one or 2 institutions were readjusting their "book" to re-risk from cash to certain equities"... lol.

Moimoi - nearly right - Bryan says “Pre-Christmas one or two institutions were down-weighting their position in Rakon and they may well have finished that now.”

Moimoi + Bryan ....... surely not .... but maybe moimoi advises Bryan ... ha ha

[Zaphod]

Perhaps RAK is becoming the new CTL?

[stevo1]

If they come to the market at this stage wanting money they will get hammered(and rightly so IMO).I for one would be gone like a shot.They have had all their chances as far as I can see.You would hope the directors have enough sense to realise this and have adjusted their attitude and management for this not to happen

[Master98]

Believe or not, the fact is RAK is really hungry for money, if they dont go to market place, then they will have to find right institutions.

[Blendy]

I wonder if the new factory in China is supplying parts for the new iPad3? This stuff.co.nz article says that dissecting one reveals that lots of suppliers are making parts for them, but that
"Apple doesn't disclose which company makes the components that go into its smartphones, and insists its suppliers keep quiet."

http://www.stuff.co.nz/technology/gadgets/6587447/Dissected-iPad-reveals-Samsung-parts

[Blendy]

yes, it's a bit hard to know what to do at the moment. finger's crossed it's going to eventuate into good news!

[moimoi]

Those involved in RAK must be longingly gazing, and shaking their heads in amazement, at Diligent Board Member Services (DIL) with its adjusted ebitda of just $US2.5M last year and yet a market cap approaching an eye watering $300M.

Unlike RAK it is somehow is immune to "market participant" concerns of selling product in $US which in DIL's case is clearly no impediment to ballistic NZ share price performance.

RAK on the other hand, despite $200M odd in sales of products seemingly in high demand wallows, unloved, at a market cap of $90M odd.

I don't get it.

[Master98]

if their next month annual report disappoint shareholders again, then sp will rapidly approach around 30c, my point fo view is they can't meet their 2012 outlook.

[stevo1]

RAK must be an incredible disappointment for long suffering shareholders.They need to deliver profit now.It is interesting to see that their asset backing is at 87 cps.I am not sure of how much debt they hold or how much the IT property is factored into that asset backing ---dependent on those particulars and at 47 cps seems quite a discount to NTA.

[stevo1]

Here's a debate worthy of discussion: does Rakon bear comparison to Fisher and Paykel in terms of potential turnaround?

I see it like this:

Fisher and Paykel have been savaged by a collapse in consumer spending in their sector of the economy - appliances. They have become price takers, not price makers (similar to Rakon's componentry not being nearly as unique as it once might have been, and therefore at the mercy of big buyers).

In addition to this, they have mismanaged their currency hedging and have been slapped around by the high NZ dollar (like Rakon). They have moved to offshore production to offset this risk (F&P in Thailand and Mexico, Rakon in Chengdu)

F&P in 2008 suffered from executive malaise - too many old fellas in an industry that was changing. There are parallels here where Rakon is largely controlled by the Robinson family, who are reluctant to bring in external independent directors.

However, F&P Appliances is more than just appliances - they also have a very healthy finance company which is an excellent lender to the consumer and business market, assisting sales of F&P appliances.

F&P also bit the bullet and entered into a strategic relationship with major Chinese Appliances firm Haier, which will bring income to F&P in terms of licensing royalties as well as access to new markets.

F&P have also entered new markets like India.

There is hope that F&P's overall position will improve with the increasing confidence in the housing and consumer markets in the USA, NZ and Australia.

Rakon do not have an external partner that I am aware of. They don't have a diversification of interests to boost their balance sheets (like a stable finance company). They haven't, to the best of my knowledge, announced any new market entries or new products. And though there has been a tearaway explosion in consumer IT goods that might in theory include components like the one's Rakon makes (think iPhones, iPads, Android phones etc), there is no sign that Rakon is benefitting.

I bought into F&P at 35c because it looked too cheap for the next to no risk being taken on. It's risen a very healthy 60% in 3 months. I don't have the same confidence in Rakon at its current level of 47c.

Hard to disagree with your logic (or the facts sparky) the day of reckoning approaches despite (or otherwise) http://www.rakon.com/Corporate/Media/Releases/Pages/RakonUKLimitedisdelightedtoannouncethatithaswonthe covetedQueen’sAwardforEnterprise-InternationalTrade,theUK’shighestaccolad.aspx

or http://www.theaustralian.com.au/australian-it/apple-sells-35-million-iphones-in-q1/story-e6frgakx-1226337757218
if they are supplying apple then it will be obvious in their result otherwise does not look good IMHO

[darksentinel]

I talked to a friend who is an engineer at Rakon, and teasingly asked him "so, what's going on with the share price?", response: "yeah, we don't talk about that...".

[moimoi]

Dark, could you ask him something that is maybe a little more useful? (in the nicest possible way :-))

Sparky et al...something needs to glow in this upcoming full yr report for RAK. What with Apple, yet again smashing the cover off it in this past quarter.

Not only that but there has been comment very recently from both AT&T and Verizon about exponential growth in data usage on their networks as a result of Apple gadget activations. Both were key items in the placatory half year review produced by RAK.

That same review also stated that the board "had decided to seek another Independant Director to add to the Board in the New Year.."

We are well into the New Year last time i looked...

[Master98]

RAK products mainly used in defence, space and communications system, has recently very limited share in smart phone markets, i don't think RAK in any iphone supply chain at this moment.

[stevo1]

Ok, a wee Google search has brought up some recent news that is suggestive.

http://business.newzealand.com/emea/en/news-and-events/news/hi-tech-company-at-the-heart-of-the-smartphone-revolution-wins-coveted-queens-award/

It looks like that Rakon do not supply Apple, rather they supply companies that provide the infrastructure for cellphone and mobile telecom companies to operate.

Nokia may be the cellphone company alluded to above, but thats not necessarily a good sign given Nokia's own perilous position in the smartphone market.

Huawei of course tend to do well in the mobile modem space - most of the Telecom and Vodafone USB sticks are made by Huawei. I think Rakon do very well in the femtocell (mini cellphone repeaters) sector too.


The setup of factory in Chengdu in close proximity to Foxconn was done to be able to be supplier to tier 1 mobile company(who that is seems uncertain)but according to wikipeadia Foxconn supplies companies including
Amazon.com (United States)[37]
Apple Inc. (United States)[38]
Cisco (United States)[39]
Dell (United States)[40]
Hewlett-Packard (United States)[41]
Intel (United States)[42]
Microsoft (United States)[43]
Motorola Mobility (United States)[40]
Nintendo (Japan)[44]
Nokia (Finland)[38]
Samsung Electronics (South Korea)[45]
Sony (Japan)[46]
Toshiba (Japan) [47]
Vizio (United States)[48
No where to hide if they dont produce decent profits

[Lizard]

My valuation came out at 73cps. First time ever that I've found RAK worth a closer look.

I think it is worth watching for a possible recovery. However, it is difficult to get too excited. A valuation means little while a company is showing such a level of volatility in profits and is burning cash.

A friendly takeover is possible, but does not seem likely. Nor does realisation of assets and/or return of capital. Nor does new management that might find a focus on sustained/consistent earnings. In all likelihood, this will drift along over the years, reducing in liquidity and broker interest, while profits and the share price fluctuate wildly with the economic weather.

I'll keep it on the watchlist for a possible medium term recovery trade.

[kizame]

Snapiti - appreciate that you have been burnt, or know investors who have been burnt.

I know it's easier said than done, but divorcing emotion from your investing decisions is said to be one of the big keys to investing success.

If the investment is poor, and won't go anywhere for the forseeable future, then you really need to weight up exiting the investment and reinvesting in something that you think will do well.

If you think there is genuine risk that your investment could go even lower, then investors would be wise to exit and be rid of the bad news and the headaches/sleepless nights that such a bad investment would cause.

Sure, they might do better in their next announcement, but on probability, they probably won't.

I lost a small amount of money recently when I divested from GPG. Bought in at 57c. Sold at 50c when they made their recent announcement with bad news on pension funds and environmental issues. What really brassed me off was their Chairman quoting Buddha as a reason for shareholders to be calm. I don't like that kind of crap. I swore, grumbled to my broker who was equally as scathing of the company, and got out.

GPG is still at 50c. I put the money into F&P Appliances instead, buying in at 41c. It's now 54c today, so silver linings and all that!

The important thing is letting go of your emotions. People think backwards with investments - you need to think forwards. Don't let a bad performing share live inside your head rent-free.

So sayeth me, and what would I know anyway?

Well said Sparky,great advice,too many of us fall into this trap.

[Under Surveillance]

RAK products mainly used in defence, space and communications system, has recently very limited share in smart phone markets, i don't think RAK in any iphone supply chain at this moment.
The word on the Street is that they supplied bits for the North Korean "satellite" launched recently, and for the fake missiles in the centenary parade. Repeat business there could be a gamebreaker, especially if the latest Kim is talked into taking a seat on the RAK board by the Robinsons?

[Master98]

you got it, U.S.:)

[winner69]

The word on the Street is that they supplied bits for the North Korean "satellite" launched recently, and for the fake missiles in the centenary parade. Repeat business there could be a gamebreaker, especially if the latest Kim is talked into taking a seat on the RAK board by the Robinsons?

Is that another 'suggestive' statement?

Prob the USA giving RAK a BIG bonus for making the missile fail

[stevo1]

the reality is RAK are going to continue with suggestive remarks and plans leaving it up to the optimistic share holders to dwell on selling their shares for massive lose's or holding in there waiting (more than the current six years) for this company to turn into a real business. In the meantime this mainly family owned company is going to tell you whatever they legally can to keep you invested. From the investors I talk to their patience is running thin but no one likes to sell share's at a massive loss even if their is only a slight chance of a recovery and RAK will play on this. For those who exspect RAK to knock out, a way overdue, fantastic result dont hold your breath, share price to lurch down after another over promised results then overtime watch your money dissapear under current company direction.

The appt of Peter Springford to the board of RAK came with the statement
"The Rakon Crystal Chengdu facility was completed last year and is continuing
to expand its operations. It has recently shifted to 24-hour-7-day
production. It now has almost 200 employees and the facility will be further
increasing capacity over the next few months. "
Could be more rhetoric snapiti ? definitely mean more production provided it translates into decent profit.
https://www.directbroking.co.nz/DirectTrade/dynamic/announcement.aspx?id=3070863

[moimoi]

Well well. It was only a page ago that i muttered about the lack of appointment of another Independant Director. And up he pops today. :-)

A well received announcement it seems with a burst of institutional buying today.

[Lizard]

Over 400,000 shares or around $200,000 of buying. Not sure if it is institutions, but there may be some bigger investors buying in. Most of the trades from 4pm onwards are in the sub 10,000 share trade size, with one trade of 48,000 shares at 50c.


Lots of ST readers front-running you Sparky? :p

[Master98]

Historically , RAK good at doing "words" game to fool their shareholders, their annually report due to this month, yet to announce release date, china' factory needs more funds to throw untill the operation is profitable which is few more years away......

[Catalyst]

It's been an interesting week for RAK...

Monday - Some entertaining comments on Sharetrader..."Ok, so we think RAK are full of horse by-product."!!

Tuesday - RAK announce a new independent director and commented that its new Chengdu factory is increasing capacity. RAK's share price jump to 51c on that day also triggered a few technical buy signals, the first buy signals in months (break in short-term down trend, break in OBV and RSI indicators, break in 50c resistence level, 3rd bounce off 47c support level).

Wednesday - More entertaining comments on Sharetrader..."RAK thinks it is the pied piper and shareholders are rats."!!!

Thursday - NZDUSD broke it's 81c support level, to its lowest level since January. A good sign for struggling exporters.

Friday - Can't wait to see what happens today!

Disc. Bought some RAK this week.

[moimoi]

Impeccable timing it would appear, your involvement seems to have been a catalyst for movement. :-)

A sliver of volume of late i see...

[Hoop]

Is this a good omen? Peter Springford, the new director, has bought $20,000 or 40,000 shares in Rakon.

http://news.iguana2.com/o-FC2EtCcgHflv7i_SlTTB/NZSE/RAK/222590

Now, directors sell shares for all sorts of good reasons (and bad ones too).

But they only buy shares for one reason - they expect to make money.

Good Omen ???....Nah
Director buying is not something a shareholder should get too excited about. RAK directors also acquired in 2010 and 2011 from looking at the old News.

Classic example I will never forget was Paul Byrnes Director and Accountant with Dorchester Pacific (DPC) The share price started to tumble in 2007 .. It turned into a steep ski slope chart down from $2.40 and then it leveled out around 80c in Nov 2007 then at the end of Feb 2008 saw Byrnes enter buying at 82c .. Gee wiz a accountant buying in..WOW!!!. that has to be good news that DPC has gotten far too cheap,,,eh?...My finger hovered over the buy button and waited for the TA buy signals.....Nope..The downward spiral began again in March 2008 and Byrnes tried catching the falling knife buying in at 69c 58c 53c. Present share price 9c

[Hoop]

did he purchase them or has he been gifted them as part of his directors salary package, the notice does not say that they were purchased on market or for how much. either way more of RAK games to try and hype their stock price up before there next annoucement.

I wrote an email to the NZX a couple of years ago complaining about those notices...Suggested they added another line to distinguish whether the change of shareholding was due to a purchase, sell or conversion.
It must have been too hard for them as I never received a reply.
Maybe If we all emailed the NZX.........:D

[Silverlight]

I wrote an email to the NZX a couple of years ago complaining about those notices...Suggested they added another line to distinguish whether the change of shareholding was due to a purchase, sell or conversion.
It must have been too hard for them as I never received a reply.
Maybe If we all emailed the NZX.........:D

Hoop they aren't the NZX's notices, the MED designate the format and the sec com (now FMA) govern that the notices meet the laws requirements for disclosure, NZX do no more or less with director or SSH notices than they do with any other announcement made by a company.

[Hoop]

Hoop they aren't the NZX's notices, the MED designate the format and the sec com (now FMA) govern that the notices meet the laws requirements for disclosure, NZX do no more or less with director or SSH notices than they do with any other announcement made by a company.

Silverlight... is MED the Misery of Economic and Development?
NZX still should have replied to my email :t_down:

[skydog]

I say Rakon is more like a circus. On 17 May, their spin will be along the lines of, "more competition, in a more competitive market, high HOPES for the new plant in China, and with recent declines in the NZD the future is looking brighter, blah blah, ......so roll up, roll up, 2 shares for a dollar says ring master Robinson.

[stevo1]

The universally bad press and sentiment have swayed me I'm gone this morning with a small profit.If it is as brokers are saying in the Herald then the SPO will get trashed

[skydog]

I was expecting RAK to drop like a rock when I read the article. Why only the small decline? I suppose the *&*!@ will hit the fan on Thursday. I'm only a small holder, but no one likes a loss no matter how big.

[Silverlight]

Rakon at the current price looks very good value if you can quantify their expertise in the field of crystals.

They are trading around NTA, with no value priced on any future growth, while posters over the past 6 months have been discussing their underperformance of the past 3 years, the company has announced nothing material, giving posters ammunition only to discuss poor management history, everyone knows this, and the high dollar, everyone knows this as well.

I don't understand their technology from a detail point of view, I understand their crystals go into everything GPS etc, but I don't really understand how it all works, there is so much jargon, but I do understand revenues and units sold. Their shareholders letter update in 2011 gives a good overview of telling the story, and growth in revenues, nearly $200m in revenues!

Back to the if statement, if I substitute my lack of knowledge in crystals for an experts, by looking at the many awards Rakon has won, and continues to win for their expertise in crystals, then the conclusion I get back to is an excellent entry level price. Past and continuing poor management is embedded in the current price as is the high dollar.

Rakon only need to announce some slightly positive news and the price will be back above $1, (eg disclosure of a JV, or revenues passing $200m or something out of left field).

EDIT: here is a link to the shareholder letter: http://www.rakon.com/investor/announcements/reports/Public%20Reports/FY2011Letter.pdf

[Catalyst]

Nothing in the Herald article was new news so I'm surpurised that people are getting their knickers in a knot. RAK signalled back in November 2011 that it's FY12 result will be below par. The company has since reiterated its FY EBITDA guidance of $14 - $18m, which corresponds to an NPAT of somewhere around $1m. Yes, a disappointing year. But the share price took much of its medicine back in November when it announced its poor half year result and its share price has bounced around the 50c price since then.

From here, I'm more interested in...
- Comments from the company about how much its new China factory will contribute to future earnings, and any comments about market performance;
- Any FY13 earnings guidance; and
- NZD performance.

[winner69]

Belg is right - now is the time to be interested in RAK as the (expected) bad news is all factored in the share price

What is the worry though is how long can they keep promising the world and under delivering .... how much more patience do shareholders have to be

Seems like RAK are following in the path of FPA in the first instance .... or even worse they could end up like WDT .... all three tout the innovation story .... global businesses .... getting manufacturing efficiencies by going off shote .... and deliver paltry returns to shareholders .... somethign not quite right is there

[Catalyst]

More disappointment. I'm out.

[karen1]

Something I must have missed in other results presentations:

"Although management and directors may indicate and believe that the
assumptions underlying the forward looking statements are reasonable, any of
the assumptions could prove inaccurate or incorrect and, therefore, there can be
no assurance that the results contemplated in the forward looking statements will
be realised."

Says it all, really.

Absolutely not a word from the man himself.

[stevo1]

Pleased to have bailed this company needs to get it $%^# together and make profits not noise

[Hoop]

For Investors not holding RAK there's nothing like a bit of comedy to brighten up your day.

Belg Winner & co...market already factored this result in :confused:...yep the market may had...

However.....quote from the 2012 Annual report...



Mr Robinson said the company is now very well positioned to take advantage of



this high-growth market, expanding and acquiring new business with the


premier tier one and two manufacturers, particularly in China.


He went on to say "we have never felt better about the business' overall



position, the market opportunity and our customers."



But the market had not obviously factored in Mr Robinson's rosy bullish outlook quotes.......:D

..They did today.....http://www.sharetrader.co.nz/images/smilies/thumbdown.gif
RAK at 47C down 7c -13%

[ratkin]

So much for the theory that all the bad news was already factored in

[Silverlight]

The result was inline with expectations I thought, if the future for Rakon is broke or $5 a share, then entry at 45 -55 cents becomes slightly irrelevant, for posters selling today, what new information made you sell? Very interested to know.

60%+ of the stock is still held by insiders and institutions, Robinsons 23%+, Harbour 9%, AMP 7%, Gaynor 6%, Maire 5%, ACC 5%.

The only output of concern from a financial standpoint is the cash burn, if they continue into 2013 this way, they will need to borrow more, easily done, as debt to equity is pretty low, or have another capital raising, not ideal for current holders, but probably suitable given their currently unrealiablity of generating enough free cash flow to fund growth.

On a positive note NTA remains stable at 85 cents, and this may fuel a cheap takeover ploy by an international company like MiTac who bought part of Navman.

[The BOWMAN]

Utterly disappointing result during the time almost every gadget carries a gps chip. If they can't make more money now, when will? However the price does seem to stay where it is, maybe the bad result was indeed expected.

[Master98]

France and UK business is getting weaker and auckland based is getting worsen, expanded business in china at wrong timing, what a mess!

[Master98]

Is the closing price today ($0.42) an all time low?


yes all time low until next week

Today's low was 40c.

[winner69]

Today's low was 40c.

and well rewarded for achieving this target ...... (from the NBR) Brent Robinson's remuneration rose 6.7% to $846,573 and Darren Robinson received an 8% increase to $691,800 in the year ended March 31, according to the annual report.

Liked one of the comments that followed .... presume was tongue in cheek

Rakon Remuneration Committee members:
1. Brent Robinson
2. Darren Robinson
3. Blind Freddy

[Master98]

"Rakon managing director Brent Robinson and marketing director Darren Robinson got pay rises last year even as the shares more than halved in value and the company continued its policy of not paying dividends."

"Interests associated with the family have about 23% of the shares and a separate family company, Trident Investments, leases property to Rakon on commercial terms."
http://www.nbr.co.nz/article/robinsons-got-pay-rise-year-when-rakon-shares-tumbled-wb-121843

So in 2006 RAK IPO, the family only sell the business and retain all property and leases back to rakon, till now and will be rakon only working for this family...........

[Balance]

Well with a performance like that, I'm jolly glad I don't own any! It's companies and management like these that highlight the great shame that there aren't activist investors in New Zealand of the likes of Carl Ichan in the US. Look for example at what he's doing at Chesapeake Energy. Everybody who's a shareholder in Rakon should read this link.

http://www.forbes.com/sites/christopherhelman/2012/05/25/carl-icahns-letter-to-chesapeake-energy/

We used to - until they all were seduced into the dark side, of becoming the same as the very same directors, management and companies they were taking action against. Great example - Ron Brierley, Tony Gibbs etc.

Then there are those who simply gave up as they found it too exhausting trying to change the loser mindset of New Zealand investors - eg. Bruce Sheppard. I was at the Hanover meeting where those gathered all sat there like sheep to be slaughtered and actually tried to shut Bruce down!

[Zaphod]

The Board needs to go - in its entirety.

I hold special contempt for Maire - who honed the craft of issuing useless 'positive spin' press releases at CTL, while simultaneously flushing great wads of cash down the proverbial toilet - and the Robinsons, who seem to believe that this company is their private play toy, and shareholders are viewed as those cousins that you don't really like, but still have to invite to family gatherings (aka annual meetings).

But of course they were voted in by the shareholders. Let's see if years of exceptionally bad management and exceptionally poor financial performance will put the vast majority of shareholders off re-electing these dimwits. Unfortunately, I don't think it will.

*For the record I exited RAK a few years ago, after voting against re-election of the entire board, but finding myself in the minority.

[winner69]

I'm so sorry Mr Irvine for being so stupid .... of course Robinsons pay was last year pay .... we all should have realised.

Nice of you to tell us that he will be getting paid less this year .... but jeez he gets a paid a lot doesn't he

Sometimes methinks people should just shut up and not try to explain/justify contoversial things .... and this is one time that Irvine should have said nothing.

Must be feeling guilty

Rakon Limited Independent Director Bruce Irvine has responded to media reports of salary increases for Rakon's top two executive employees Brent Robinson and Darren Robinson. Irvine explained that the remuneration of
senior executives in the company included a fixed and variable incentive element..

The figures reported in the media were based on disclosures in Rakon's 2012 Annual report published on Friday 22 June. Remuneration disclosed related to that earned in the March 2012 year. As such it included variable compensation determined and paid in June 2011 for the March 2011 year. This variable compensation was based on company and personal performance in that year and is not relevant to the recently completed March 2012 year.


Irvine noted that variable element for this recently completed year (March 2012) was substantially reduced from the figure forming the basis of the media story, because the financial results fell below the prior year and company targets, despite the company's success in expanding its business globally.

Accordingly the total remuneration for FY13 that is paid to senior executives, who have a variable element, will be substantially lower than that paid in FY12. This will be reflected and reported in the 2013 Annual Report

[janner]

Thunderous applause from the floor !!

[janner]

Disc... Zero.. Thank goodness

[moimoi]

Nevermind the this year versus last year flimsiness...that announcement just confirms that renumeration isn't impacted by any relevance to the share price as that has been downtrending for about 5 years.


But whats this?...signs of market interest? up 20% in a week...

[Under Surveillance]

Brent Robinson of Rakon is one of the supposedly "visionary entrepreneurs" who are finalists in this year's Entrepreneur of the Year circus conducted by Ernst & Young.

The byline in the advert in today's Dominion-Post listing the finalists is: "Some people focus on what is. Some on what could be. A genius can see both at the same time." Needless to say, this twaddle is unattributed.

For mine, if Robinson can see that what is is a share price of 43, and that what could be is insolvency, he would demonstrate common sense (one could hardly say genius) by quitting from his positions at Rakon and allowing an infusion of competence at board and executive levels.

[winner69]

Brent Robinson of Rakon is one of the supposedly "visionary entrepreneurs" who are finalists in this year's Entrepreneur of the Year circus conducted by Ernst & Young.

The byline in the advert in today's Dominion-Post listing the finalists is: "Some people focus on what is. Some on what could be. A genius can see both at the same time." Needless to say, this twaddle is unattributed.

For mine, if Robinson can see that what is is a share price of 43, and that what could be is insolvency, he would demonstrate common sense (one could hardly say genius) by quitting from his positions at Rakon and allowing an infusion of competence at board and executive levels.

Joey Adams once a genius is one who can do anything except make a living