SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Actel [ACTL]
ACTL 0.00010000.0%Jul 16 9:30 AM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Ken Muller who wrote (333)9/12/1996 5:44:00 AM
From: Len Hannegan   of 674
 
Ken, earlier in the year you had a post that appeared to me to cast a negative shadow on Actel. Why is Actel now a bargain considering you post below. I would like to know in that a broker got me into to Actel at 17 something a few weeks ago.

for review is your earlier post. Please note, I'm not trying to make trouble here, I'm just trying to understand.

Yo Eleven:

I've been reading with interest your communications on Actel with
the various parties on line. I thought I might throw some comments in
to supply some food for thought.

I sell Actel as well as a number of asic and foundry semis (both US and
Asian rim). There are larger global factors which might affect Actel's
near term performance. There is a tidal wave of fab capacity which
hit the Dram market over the last 9 months. More capacity is coming
on line later this year. I've been in this business over 25 years and
this is probably the worst excess I've seen. This capacity is rippling
out to the Asic and custom IC arenas (It takes approx 6 months to
modify the standard Dram process to optimize it for logic circuits.)
Foundry prices for wafers are going into the "mud".

This is good news for the fabless design houses like Actel. However,
price competition in the FPGA marketplace(as everyone scrambles to
maintain market share)is reducing average selling prices (ASP).
Altera and Xilinx 2nd qtr revenue results are the first indicators.
Next qtr will probably get worse. I am seeing 50% reductions since Jan
on quotes from compettion on new designs. Savvy purchasing people are
requesting (and getting) reductions in prices on current backlog.
Adding to this problem are Asic foundries which are now dropping their
minimum order requirements to keep their lines going (This siphons off
medium volume FPGA business - 5000-10000 units.)

The signs point to increasing unit production but overall
reduction in gross revenue as the pricing continues to crater.

The $64 question is: Can Actel(or Xilinx or Altera) maintain or
increase their gross profits with declining revenue? This will be
very difficult.

I am not sure if the true implications of this vast overcapacity of
IC fabs has sunk in on the investment community. I keep reading items
like its a good time to buy because prices are down without any real
discussion on the underlying causes. I think a few inverors are
liable to get burned.

Anyway, those are my thoughts, for what they're worth.

JKM
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News