| Ausdauer, I see a lot of people clamoring about pricing crashing on the other board in which I SHOULD be able to contribute to. Here's what I see, which is, pricing being down around 11% this quarter for SNDK, and another 10% for Q4, followed by 13% for Q1. All in all, the nand players seem to be managing this very steadily in reducing pricing to continue stimulating demand. Now, the question most will have is, can SNDK keep up with their cost reductions? I would say absolutely for Q3/Q4. I believe their product gross margins will fall only 3 points from what they did in Q4, which is nothing. I see Nand going right back on allocation in very early March, followed by the rest of the year in undersupply. The price cuts throughout Q3/Q4/Q1 will put nand in a deep undersupply in my opinion for next year. Yesterday, Sanjay said nand will be in undersupply for 2011, and he's not wrong. I believe the market realizes that the price declines will be steady for this and the next two quarters, but that's it, hence the reason why the stock is slowly making its way back up. The market looks six months ahead with SNDK, so I really expect the stock to start making a slow move up from here, with the exception that I believe there is further news coming in October which will push the price higher, and I'm not talking about earnings. |
