Doc, Huey,
Thanks for sharing your views and those of the analysts. If the low density markets continues to be strong, then SSTI stock appears to be dirt cheap in the low 30s, even with its remarkable performance of the past 2 years. It is my nature to find things to worry about, especially when it comes to buying companies which have recently had parabolic moves, as SSTI has. Obviously, I prefer to buy them before the move, but this can only rarely be done<g>.
One of the items in the First Union report is a mite confusing. Under "Pros", he says, "* Diverse customer base and multiple target markets limits risk", but then under "Risks", he says, "* Dependence on a limited number of customers and distributors". So which is it? Seems a little contradictory, though perhaps he means the customer base is potentially diverse with all of the new applications that are coming on-line that will require flash, but actually limited right now as SST continues to ramp their volume.
The other thing I still worry about goes back my example of last week. Did Intel cede to 2mb space to SST for competitive reasons, or because they believe that the low density market itself will demand higher densities in a year or two, and they preferred to aim for that market? I know one answer to that question--some applications won't ever require more than 2 or 4 mb. But I don't really have a clear enough perception of the many uses of SST chips yet to have a feel for how the migration upward of the market will affect their volumes and margins.
But of course, if there weren't risks, this wouldn't be the stock market.
Best wishes,
Sam |
