If earnings are driven down by increased R&D requirements then the takeover premium that AZV has been trading on needs to become progressively larger to support prices at these levels (even after the drop). Also, in my view there is more value to an acquirer in AZV's existing customer base than there is in any of AZV's technology, and the R&D spend would largely be to keep pace as I don't believe they are a market leader from a technology perspective, not to say that their products aren't high quality.
AZV Price at posting:
29.0¢ Sentiment: None Disclosure: Not Held
