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Technology Stocks : EZchip Semiconductor
EZCH 25.490.0%Feb 23 4:00 PM EST
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Squeak22
To: shlomi cohen who wrote (2451)11/4/2015 6:06:46 AM
From: w0z1 Recommendation  Read Replies (1) of 2675
 
As a user of EZ's chips, eventually the NPS-MX, Mellanox will harvest 10 times the revenues EZchip can get as a producer of chips alone.
This makes an implied assumption that MLNX has no competitors who would represent a market for NPS and MX. EZCH's TAM would actually shrink because MLNX competitors would likely not buy captive chips from MLNX.

I liken EZCH's position to AMBA in the video processing market, or SWKS in the cellphone market (or pick your favorite). They are quite successful supplying arms to all comers and would probably resist a takeover attempt by any one company (e.g. GPRO, DJI, TASR, etc).
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