WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 163.58

+0.2%

Dec 1 3:59 PM EST

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To: Robert Douglas who wrote (21283)	12/10/2001 11:40:26 AM
From: Art Bechhoefer	Read Replies (1) of 60323

Robert, the Merrill Lynch analysis seems already reflected in the price of SNDK. (Note that these recommendations are made public AFTER Merrill's clients have been notified.) One thing missing from the analysis, however, is the potential one-time gain from appreciation in the price of securities held by SNDK, whose prices have dropped below cost. As these securities appreciate in value (UMC and Tower Semiconductor), the addition to earnings could wipe out losses coming from the increased cost basis of the fabrication facilities. I would also question whether this increased costs basis, as Merrill calls it, isn't already factored into the earnings. After all, SanDisk has been taking the expenses of building and operating the factory as they occur. I take this Merrill analysis with a grain of salt. It really doesn't say anything more than we learned at the last earnings statement and conference call. It does indicate, however, a growing realization that SNDK remains well positioned to take advantage of the growing demand for low cost flash memory. Art

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