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Technology Stocks : EZchip Semiconductor

EZCH 25.49

0.0%

Feb 23 4:00 PM EST

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To: The Ox who wrote (2597)	12/16/2015 9:01:53 PM
From: Squeak22	3 Recommendations Recommended By longezch NapaDoc The Ox Read Replies (1) of 2675

Keep in mind the MLNX offer is for 8 times sales...... Does that 8x include the company's own $200 million cash balance ($6.66 per share)? Does it factor in earnings, which are key to any valuation analysis? Does it factor in the R&D&E dollars that were poured into developing the NPS and Tile MX-100? Next year, analysts project $1.63 in earnings on Yahoo! Less cash, the PE ratio is ($25.50 - $6.66) / $1.63, a PE ratio of just 11.6. Personally, I don't think a PE of 11.6 is a fair return and intend to vote no (again). Looking at the NPS alone, there are 5 Tier-1 wins (including three Tier-1 data center wins from the likes of companies like FB, GOOG, AMZN or MSFT) on the horizon for 2017. There's growth projected due to two new product cycles while the current products are locked into their existing designs for several years. But disagreement is what makes a market. Is there risk, to the downside or upside? Of course...but this is true of any investment. Good luck to all. -S

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