IDTI - an IC Play on Growth Markets Message Board

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Technology Stocks : IDTI - an IC Play on Growth Markets

IDTI 48.99

0.0%

Mar 29 5:00 PM EST

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To: Jim Oravetz who wrote (10710)	3/29/2000 6:25:00 PM
From: John Miz	Read Replies (1) of 11555

From Prudential...Their thoughts... IDTI: Update; Reports Earnings April 26th at 2 PM PST Integrated Device Technology (IDT) management continues to generate shareholder value. In February IDT spun-out their Quantum Effect Devices (QED) investment through the sale of 828,000 shares, which generated $12.3 million. We anticipate sometime in the next six to 12 months the sale of more QED stock to unlock additional shareholder value. Similarly, the Company yesterday announced plans to reduce its ownership of Clear Logic. We believe this announcement is a positive step that will also increase IDT's shareholder value, since the Company's ownership of Clear Logic will be reduced from 81% to 56% in exchange for $22 million in redeemable preferred stock. IDT will report fourth-quarter and year-end results for fiscal 2000 on April 26th, at 2 PM PST. We are expecting revenues of $186.5 million for the quarter and $682.3 million for the year, compared to $139.4 million and $540.2 million for the same periods a year ago, respectively, or a year-over-year increase of approximately 33.8% for the quarter and 26.3% for the year. We expect earnings per share for the quarter to be $0.35, compared to $0.10 for the fourth quarter of 1999. For fiscal year 2000, we expect EPS of $0.90 compared to ($3.43) in fiscal 1999. We expect this to be the first year for the Company to post positive earnings since it began its transition from a commodity SRAM producer to a proprietary communications chip company. We estimate gross margins will improve from 45.4% in the year-ago period to 50.2% in the fourth quarter due in large part to the rollout of the .18 micron fabrication facility from the .35 micron facility which, once completed, should increase capacity by 50%. We reiterate our STRONG BUY rating and $52 price target on IDTI.

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