greg, re:<although AMD may retest the recent high of 45, it sill probable trade in a range from 30 to 40 for the next six months>
I have a different opinion, more bullish than this, but not as bullish as "niceguy." Greg, we all keenly remember how breakeven was achieved a quarter early in Q3'98 and then a higher than expected profit in Q4'98 --- to be followed by the disaster of Q1'99.
What happened then is Intel kept making faster and faster parts and AMD couldn't (very unlikely Q1'00).
Also, the K6-3 failed to ramp, yields must have been terrible. Maybe this quarter the K6-2+ won't ramp, but thats just the low end part now, not like the "high end" K6-3.
If AMD even sells just 1.2M Athlons at a lower ASP of $220 and a million less K6's (4.2 million) at a lower ASP of $55, they'll have the same CPU revenues as this quarter. Flash and Comm will grow enough to cover the increased R&D and Depreciation. I just don't see a downside to earnings.
However, I do think it will take three tries to get through the all time high (48) and we've just had one. I would expect the second try to occur with a couple pieces of good product news, OEM news or one of the following: finding a president, selling part of Comm Group, partner for Dresden. The third try will be successful, and I expect it no later than Q1 earnings.
Petz |
