PMC-Sierra (PMCS) Message Board

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Technology Stocks : PMC-Sierra (PMCS)

PMCS 11.65

0.0%

Jan 25 4:00 PM EST

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To: John Farrell who wrote (3397)	4/14/2000 2:17:00 PM
From: SJS	Read Replies (1) of 3818

CSFB review the PMCS quarter report __________________________________ PMC-Sierra (PMCS-$125 6/16-$21 B-Strong Buy) ?Unusually Robust Business?: PMCS Beat our 1Q Estimate AND our 2Q Estimate! CY00E: $0.78; CY01E: $1.17 (formerly $0.75/$1.10) ú PMCS posted an incredible 28% sequential growth for 1Q00 to $103 MM, with gross margin hitting 80%. That said, while PMCS reported $0.17 on a pro forma basis (beating consensus of $0.16), results would have been $0.21 without the higher R&D and share count effects from the recent AANetcom and Toucan acquisitions. ú PMCS increased its engineering pool through internal recruiting and recent acquisitions: Extreme Packet Devices, AANetcom and Toucan (179 employees joined PMCS, with roughly 100 from recruiting). This design talent boosts product development and signals the seeds for future revenue growth and higher value products. ú Both the number of socket design wins and the dollar content per system continues to increase significantly and reflects PMCS's strategy of providing architectural solutions is rewarded with multiple wins. ú We reiterate our Strong Buy, increasing 2000 estimates to $0.78 (revenue of $500 mm) and 2001 EPS to $1.17 ($760 mm in revenue). Our price target remains at $250, but plenty of upside remains.

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