And then Subtract 30% from that because we now have about 30% more shares in the market.

BCD

Jack,

I am not really worried about if what Poet is proposing can be done mostly because they have already done it.  As I have pointed out in a previous post 2 of the 3 components for the AOC have been verified and the 3rd was verified at the Lab setting but not witht the new "formula" in a production setting.  I see this as a pretty clear sign that it is just a matter of getting the recipe right and optimized.  They know that it works, now they just have to fine tune for production.  These people are not coming here for a product that "MAY" work.  The science is sound, its the Product that needs work.

I have faith that the people we have in charge are way better scientist than they are market Guru's. I have said it before, I think they are so focused on the science that they neglect the market, because they have the "If we build it, they will come" mentality.  That is my only frustration.

BCD

So in an effort to not soley post negative info and also to explain why I still hold all my shares in this company I want to put a few facts out there.  These mostly relate to the technology and come directly from past NR's.

1. We are 10 months into an 18 month agreement with A*Star.  This is for development of technology that we generally don't even discuss on this board because there is not much info about it being released.  But we do know that it is about Micro Displays specifically targeting the VR market.  I assume that since we are just over half way through with our initial term that we should have some progress being made on this front and will get news about where we stand on this initiative this year.

2.  We have 2 of the 3 components developed and being optimized for the AOC as of 5 months ago.  The last remaining device is the VCSEL.  The company has stated that the VCSEL is more of a matter of when it gets done as they have verified multiple times that it is feasible and they are really only trying to optimize the Expatial stack to allow electrical pumping of the Laser.  This is where the delay.  But they have made steps to correct this as of November.

3. There is also some evidence that once this is complete there is interest from a company to License via NRE.  But there is also this one little sentance that makes me think there is something more going on besides just the AOC.  Namely something to do with the detector.  

• POET has received specific interest in applications from prospective customers and is in advanced discussions to license for non-recurring engineering (NRE) fees and transfer our proprietary integrated planar opto-electronic technology. Included in the talks is the proposed establishment of a platform for the development of integrated sensing applications.

So with all these things having taken place and now the placement of what appears to be a Production/Sales force in DL, I make the assumtion that not only is DL about to ramp up sales but Poet products are near completion at the Alpha Prototype level (at a minimum).  

There are many thing this management has done that I don't agree with, but there is no denying that they are Tech Savy individuals.  That is why most of my complaints have not been about what they are doing Tech wise, but what they are doing Market wise.  I thing they have the philosopy of "If we build it, they will come..."  Which may be the case, lets hope so.  Until we get some solid news on any of these fronts we are stuck here, but I do believe that we will get news about all of these things this year.  Hopefully in this quarter or the next.

BCD

I was hoping you would chime in on this one.  When it comes to the depth of understanding exactly how the Tech works we have some good resources here.  Periodically I will just type in "Integrated Photonics News" into google news and see what new pops up.  It is very obvious that the big push right now is to Monolithicly Integrate all parts of an IC using Photonics.  There are now way more than I have ever seen groups of people pursuing this path.  It means we are in the right area, if we can pull it off, to make a huge impact and lots of money.  Elenion is another company that I believe has been spoken about on this board.  They are a private company but are just emerging in the PIC space, and have yet to announce the newest products.  But they will before May they said.  Google them if you haven't, they have been in R&D a short time and are about to come to market.  This is the type of News I want to start hearign from Poet.

I am attaching some quotes from another article I read today that I find relevant.

The most important aspects are just beginning to happen: automated packaging and automated wafer-scale testing using tools that are only available at 200- and 300-mm wafer sizes, and that will be the real revolution. 

and

The big revolution is taking photonics from the edge of the circuit board and embedding close to electronics, increasing capacity and reducing power and cost by eliminating the SerDes [serializer/deserializer] required today. We will move to 3D integration of electronics and photonics, enabling processors, memory, switching chips, and sensors with far more capability than is available today. This photonic revolution has only just begun. The line between electronics and photonics will blur to the point that we don’t recognize the integrated circuits of the future and that will enable many new applications.

http://www.novuslight.com/transmitter-co-integrates-laser-and-silicon-modulator-on-soi-wafer_N6453.html

So if I am understanding this article right, this company is integrating the laser on the chip, same as Poet but needs to scale up and have a receive function.  Still R&D right now, but they are doing it with Silicon photonics.  Which my understanding means if they are succesfull could actually be the first real competition Poet has seen, as it is not a hybrid approach.

Please tell me if I am missing something.

“This demonstration is the first step towards a complete integration of a light source into a fully monolithic silicon photonics chip, including a receiver. This has never been demonstrated,” confirms Ferrotti, who presented the integration of the laser on the backside of the wafer at last year’s International Electron Device Meeting (IEDM). “By combining these two studies, in the near future, we’ll be able to build a fully integrated Si-photonics chip,” the expert projects.

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BCD

Well just use a standard Valuation model and plug in some numbers.  With a sharecout approaching 300 million for ease of math lets just use that.

What is a good P/E ratio for a fledgling tech company....not the ridiculously high numbers for a growth company (because we arent that yet).  10X maybe I think thats fair, lets double it to 20X earnings....not revenue.

So to reach $1 a share on a 20x P/E basis be would need 15 million in Earnings!  What does it take in sales to generate 15 million in earnings?  Thats hard to quantify, because we don't know what the overhead is or what profit margin we are working on.  But lets not forget that most longs here have a well over a dollar average.  So basically what I see is, if we have to rely on DL to get us going while Poet is being developed we could have to do around 60 Million in Sales to get to $2 on a 20X PE, which I think is high, 120 million in sales is more like it.  But that is kind of the range if we don't have some speculation driving this higher.

This is not the best model to use to value a company like Poet, but it is very standard for a company with predicatble income streams.  Since DL is not even doing 10 Million in sales you can see that we have a long way to go for DL to become the reason Poet shares rise.  This is why Longs want to see some Poet news, because if we see a major company buy into the idea of using the Poet platform, then the speculation of future sales will drive the price much higher.

BCD