Syntax-Brillian: Some Companies Just Can't Get It Right (BRLC)

Even after a management quasi-shuffle in earlier months, Syntax-Brillian Corp. (NASDAQ:BRLC) has learned to keep disappointing.

Early this morning the distributor of Olevia LCD televisions cut its sales targets as its China business changes to a royalty-based model.  It now expects sales for the current quarter to be in a range of $155 to $175 million.  Unfortunately for shareholders, that compares to $242.4 million in the year-ago quarter and estimates of just over $300 million.  The company has thus also lowered its fiscal June 2008 targets as well, but we won’t bore you with any further details.

We cannot blame a company for having to change its model, and we cannot blame a company if it has troubles merely in quarter meeting expectations.  That is life in the investment world.  But some companies, regardless of who runs them almost seem to have a culture of disappointing.  That culture seems to be prevalent at Syntax-Brillian, and we’ve warned about its trust issues in the past.

Shares are down another 8% today at $3.00 and have traded as low as $2.87, and surprisingly haven’t put in new 52-week lows.  Its 52-week trading range is $.76 to $11.70.  This is one of those instances where if you had the news ahead of time you might be expecting new lows.

If we covered this in our "10 Stocks Under $10" Letter, it probably wouldn’t be with much enthusiasm.  In fact, well you get the idea.

Jon C. Ogg
November 28, 2007