FDJA-- GETS "BUY" RATING!!!!
BancAmerica Robertson Stephens Initiates Coverage of Faroudja
Labs With a Buy Rating
SAN FRANCISCO, Nov. 25 /PRNewswire/ -- BancAmerica Robertson Stephens research analyst John Rossi
initiated coverage today on Faroudja Labs (Nasdaq: FDJA - news) with a Buy rating.
Faroudja is a leading producer of video image enhancement products for the broadcast and premium home-theater
markets. Faroudja designs, manufactures, and markets a family of products with one simple, shared purpose: to
make video images better. In its 25 years of existence, the company has put together an impressive technology
portfolio and has built a premium brand name in the video marketplace. Within the TV industry, the company is
widely regarded as one of the most advanced practitioners of video processing.
''We consider the Faroudja brand to be the Ferrari of its market,'' said Rossi.
PC convergence is presenting the company with a huge new market opportunity. The coming together of the
entertainment and information industries could turn the personal computer into a multipurpose platform, which
presents the company with a potentially enormous market opportunity.
''We believe emerging markets will likely fuel the lion's share of Faroudja's projected sales and earnings growth
over the next several years, as the company moves to capitalize on opportunities presented by the convergence of
the personal computer and the television, and by the emergence of digital TV broadcasting,'' said Rossi.
Faroudja is already benefiting from the PC convergence market: in the first half of F1997, revenue grew 41% and
gross profit grew 58% as the company reaped its first contributions of royalty revenue.
The EPS estimates for 1997 and 1998 are $0.14 and $0.35, respectively. In 1999, a year when Rossi expects
HDTV and royalties from PC convergence to contribute 38% of sales, his estimate is $0.56.
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