Rambus (RMBS) - Eagle or Penguin Message Board

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Technology Stocks : Rambus (RMBS) - Eagle or Penguin

RMBS 88.13

+1.1%

Nov 21 3:59 PM EST

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To: jim kelley who wrote (39004)	3/28/2000 11:51:00 PM
From: dpk	Read Replies (3) of 93625

2003 RMBS earnings/sh from DRAMs= 2003DRAMmarketrmbsmarketsharermbsroyaltyrateoperatingmargin(1-taxrate)/sharesoutstanding =$60billion0.50.0150.85(1-0.35)/23.8million =$10.45/share Other chip-to-chip applications (eg communications wins)will only increase this number. At P/E of 50 (INTC and MU now have P/Es greater than that), justifies a price of $520/share in 2003 based on DRAM alone. If other applications amount to an additional 50% contribution (management has implied a lot more in their public statements) the price in 2003 could be $780+/share. Discounting it at 15%/yr for three years justifies a price today of over $500/share. Hope this helps. dpk

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