Micron Only Forum Message Board

STOCKTALK

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 : Micron Only Forum

MU 236.48

+2.7%

Nov 28 9:30 AM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: eddie r gammon who wrote (24524)	11/26/1997 10:34:00 AM
From: mike iles	Read Replies (4) of 53903

To all, MU had an analysts' meeting in Boise recently (last week? this week?) and John Lazlo of PaineWebber put out a report ... some of his comments: * management is very concerned about current DRAM pricing ... spot is $3.50 and is likely to fall further due to excess capacity * will report Q1 on Dec. 16 * he cut his estimate for Q1 from .13 to .04 (Skeeter now has the highest estimate on the street, raging bull eh?) and for this year from .94 to .69 (bateman's estimate for any time period). * roughly 1/3 of capital spending this year will be for testers and the balance for wafer fab equipment which will be installed at Lehigh ... testing will start at Lehigh next March to relieve this production bottleneck (???? not too clear ... when does wafer fab start at Lehigh? ... what happens to the production bottleneck (i.e. testing SDRAM) between now and March? ... sounds like Appleton is crying about the Koreans when his real problem is that he can't ramp SDRAM test as fast as he wants, a problem which is due to their own internal mismanagement) * plan to aggressively ramp 64 Mbit production during the next 2 quarters (last I saw 6 guys, led by Samsung and NEC were ahead of them in 64 production ... they are trying to catch up to the pack, another management decision that has put them in their current hole) * plan to convert all output to .21 and D74A process (???? first I heard of .21, what about .25 ... and what is D74A??) as soon as possible. * Lazlo rates MU neutral (i.e. SELLLLLLLLL!!!!!!!) based on the concern that DRAM overcapacity may persist well into the latter half of 1998 (echoes a comment from Chaplinsky at H&Q who just cut his estimate on TXN because of higher than expected DRAM losses ... he expects they will lose $44 million on DRAM this quarter ... says a recovery in DRAM pricing will be longer than anticipated, perhaps as late as 2H'98 ... for 2 analysts to come up with the same idea you gotta figure they're getting it from somewhere, maybe MU management. At $26 bucks MU is trading at roughly 3X its semi sales (this is after taking MUEI out at (much reduced recently) market and using a very generous $400 million for their current memory runrate ... 3X seems a wee bit high when you consider they're losing money at current prices and their balance sheet makes it questionable whether they can ante up for the next round of no-limit poker ... I think Mike Burke said a long while back that these commodity producers bottom out at 1/2 to 3/4 sales ... look out below ... 'MU .... tanks for the memory' regards, Mike

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next