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Technology Stocks : LSI Corporation

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To: E. Graphs who wrote (7782)	11/14/1997 1:22:00 AM
From: shane forbes	Read Replies (3) of 25814

-- off topic -- Hi E! When I first saw s = gate, I thought "Huh Gateway under $5"! Anyway... I think you've got a superb find here (all IMHandNotExpertO). I just went through the press releases and their web site and am very impressed by the product. Have a gut feeling their programmable ASIC solutions could do the trick in addressing the one big problem with ASIC design - high cost of initial design. Looks like with the 100k-250k designs they are attacking the right segment of the market - low end ASIC designs. Not sure if I see this as a PLD replacement because the chips still look kind of expensive relative to PLDs (not sure of PLD cost). Looks like these could be excellent for prototyping. The Siemens collaboration is a good one mainly because the access to 0.25u capacity will dramatically bring down the prices of their chips. I also liked the fact that it was a non-exclusive license. And that Siemens is interested in purchasing warrants - financial strength is always a good thing! And that brings me to the bugaboo stuff. Their financial position really stinks. I could not find and was too lazy to look for the SEC stuff (ZCAD name had something to do with this probably). But if you believe the stuff from Yahoo (Profile area) those numbers look horrendous. I would like to find out what caused those pitiful ROE and ROA #s. And if GateField has been a division since 1993(or 1994?) what was the progress of this division in years past? Looks like they were involved in other businesses before but have since divested those. Nevertheless on first impressions this looks like a very worthwhile gamble. It has that "no competition" ring to it that I always like and it appears to address a need in the market. So good luck. You may be onto something here. I've bought one under $5 stock before - LOGC - not sure why other than they may have something in the HDTV area that could be significant. Besides they are under book value (though book value may be dubious because they have traditionally carried high inventory levels and inventory valuation for semiconductor chips or unfinished products is like inventory valuation for PCs - exponential decaying behavior), have insider buying (CEO at $2) and are ramping up sales and marketing in Q4. On the downside (large downside) they have bank debt and they are dangerously close to reneging on the covenants of the bank loan. (BTW it also looks like ZCAD and I assume therefore GATE has a bank loan - the worst form of debt IMHO. Those bankers could kill the company off if things don't pan out.) Does GATE qualify for the NASDAQ "national market" or is this a "NASDAQ small cap" issue? How would I find out? BTW I see why your TA side likes it - for awhile there the graph goes vertically up. :-) !!ELO (oops! Before I forget E! this one may take some time to get going re: revenues and profits - that would be my initial sense. These design things and new 0.25u moves take time. Interesting l/t play probably leading to next year 2H. Short term - no clue.)

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