Will,
I'm dumbfounded how a marginal semiconductor company gets so much attention as VTSS does. From the point of technology maturity (including wafers, processing equipment, and designing tools) GaAs
technology can be compared to silicon one from late seventies. If anybody asks why they still exist (DoD money is drying up) the simple answer is that their market share is so small that major manufacturers never minded going after it. I wouldn't spend time talking about small GaAs companies in the States which compete with VTSS (after all VTSS is the best company in this group). The main competition is coming from silicon manufacturers who realized that there is a lot of money to be made with RF IC's. But they are going to be silicon, and furthermore CMOS silicon. Toshiba and NEC have CMOS technologies available now for frequencies of 3.5 GHz. NEC plans to introduce a new 0.12 um CMOS technology by 1998 with frequencies of 33 GHZ. I have no doubts that IBM, ex-Lucent, and Motorola can enter this market at the moment they can see some growth and profits. Of course, this means that any investments into VTSS will be gone with the wind in a couple of days. Don't worry about Cabbot, he'll pocket his profit on your expense.
GaAs, SiC, and other semiconductor compounds are great for scientific papers but money is made with silicon. Of course, this doesn't mean that VTSS cannot go over $100, but I sincerely doubt that investors are so insipid. I wouldn't short the stock as long as it keeps going up, but once the trend reverses there is a lot of money to be made.
Zoran |
