DTS, Inc. (DTSI)

falcon2382 (43.44) Submitted: 5/14/08 6:13 AM : Start Price: $31.98 DTSI Score: -8.58

This company makes important audio parts for computers, hi-def speaker systems and the technology is truly great which is why the company has seen its stock sky-rocket 40% during the past month and a half. But that's where it ends from my perspective.

My view on the larger economy in the United States and in Europe (as I have posted before, I am living in Berlin at the moment) over the next several years is dismal. Once the rest of the market owns up to the fact that consumers cannot be Atlas (the guy whom Hercules convinced to hold the world for him "for a minute" and then left him there supporting it indefinitely) without consequences, and once the rest of the market owns up to the fact that inventories are growing rapidly (I give this about a month to set in), I think companies like DTSI are going to see demand for their products diminish.

If you really want to hold the company for 5-7 years, then i believe you will be rewarded, but if someone offers you a chocolate square from his/her candy bar 5 years from now or half the candy bar now to do with it what you like, why take the former?

Enough of the metaphors, already... I hear yah. Try this on for size: During the conference call yesterday (may 13th) which saw the stock jump because of better than expected earnings, the CEO gave a fairly strict warning that next quarter won't match up. I say to myself: "Wait a minute, I thought the end of 2008 was when we were supposed to crawl out of this mess---why the warnings all of a sudden?"

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