Some days you can't do anything right. California Micro Devices (NASD:CAMD) announced a solid fiscal Q4 (ending March 31, 2006) and full-year results. However, Wall Street went and dumped the stock, for reasons that are unclear.
Revenue for the fiscal fourth quarter rose from $14.5 million a year ago to $17.4 million and operating income went from a loss of $1.2 million to a profit of $1.8 million. For the full year, revenue advanced from $65.9 million to $70.2 and operating income from $4.0 million to $6.0 million. It may be that this is just not enough growth for most people's tastes.
The company builds analog semiconductors for the mobile, PC, and consumer electronics markets. It is a tiny company playing in a market of giants, but its financial results are hard to fault. The fiscal year ending March 31, 2003 had revenue of $42.2 million followed by $59.6 million that year after and $65.9 million in the year ending March 31, 2005. The 2004, 2005, and, now, 2006 years all had operating profits.
Steady growth does not get much reward in the market these days. California Micro has an impressive customer list that includes ACER, Agilent, Celestica, Cisco, HP, Dell, Flextronics, Jabil, IBM, Motorola, Nortel, Pioneer, 3 COM Samsung, Sanmina, and Solectron. But, the stock only trades at 2.7 times sales.
The company's stock, which trades about 220,000 shares a day, has a small short position of about 575,000 shares. The announcement of the current quarter caused a pullback to $6.94 on a 52-week high/low of $9.80/$3.92. If the company keeps rolling along this way, its investors stand to be rewarded.
CAMD 1-yr chart:
Douglas A. McIntyre is the former Editor-in-Chief and Publisher of Financial World Magazine. He is also the former president of Switchboard.com, which was the 10th most visited site in the world at the time, according to MediaMetrix. He has been chief executive of FutureSource LLC and On2 Technologies, Inc. and has served on the boards of TheStreet.com and Edgar Online. He does not own securities in companies he writes about. He can be reached at firstname.lastname@example.org.