WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 163.00

-0.4%

Nov 7 3:59 PM EST

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To: Cardin Drake who wrote (12967)	7/18/2000 2:59:43 PM
From: Ausdauer	Read Replies (1) of 60323

I would think someone as bullish as you on this stock would expect faster earnings growth than what is in those "official" estimates. Cardin, I remain quite optimistic about the Q2 earnings. Much more than the actual EPS I am interested to see... I. Revenues from royalties We are at the foothills of a remarkable expansion of capacity. Over the next several years the importance of the licensing agreements negotiated in 1997 will become apparent. To this end, I already posted that Samsung has done extremely well in the first 6 months of this year. I trust a similar situation exists for many other SanDisk licensees. This should favorably impact the royalty picture for SanDisk. I would not anticipate that CompactFlash patents will contribute to the current picture given the ongoing Lexar litigation which prevents SanDisk currently from seeking royalty bearing agreements with competitors. II. MMC growth rate The revenue projections for MMC this year are quite aggressive. I see the release of many new MP3 players (OEM bundles with MMC) and, to a lesser degree, the bundling of MMC in some of the Panasonic digital camcorders to be important indicators. III. Gross Margins To a great extent gross margins will reflect both price stability and execution. The success of the migration to 256 Mbit dimensions and the planned die shrink will be scrutinized by analysts given last year's difficulties. Execution is perhaps the biggest risk to SNDK shareholders currently. IV. SmartMedia revenues Will SanDisk prosper from the sales of Toshiba's SmartMedia cards this year? Is the retail channel exposure a valuable resource for Toshiba? V. Financing of the FlashVision JV VI. Eli's prognosis for the remainder of the year. Ausdauer SanDisk...21¢ + 22¢ + 23¢ + 24¢ = 90¢ Ausdauer

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