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Technology Stocks : Micron Only Forum

MU 230.24

+2.5%

3:59 PM EST

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To: Skeeter Bug who wrote (25457)	12/16/1997 12:15:00 PM
From: Ed Beers	Read Replies (1) of 53903

Skeeter, I think that Micron's ASP will be dominated by SDRAM. EDO pricing has been pressuring SDRAM pricing but, given a general consensus that EDO pricing in now below marginal production costs, I don't expect this to continue after inventories have been reduced. The $5 dollars to earn $1 is easy. Don't forget that depreciation is not a real current expense. It is an accounting fiction to show that you have to pay off the $5. MU has been making a profit after depreciation. Now you could argue that the depreciation schedule for semiconductor equipment (specified by the IRS) is to long and causes depreciation to be understated. You might also take issue with not depreciating Lehi since it is not in service. I don't think it is fair to say that equipement costs are being ignored. Ed

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