Hi Harry. I Feel sorry for ANAD's shareholders. A colleague at work never buys small-caps. He has been buying INTC, GE(used to work for them), & G for the last 10 years and CSCO in the last 5 years. He says he does not even know his avg. cost for these stocks!!! Imagine that!!!
Back to ANAD. The punishment was due to Mfring problems(wire-bonding, bent leads, & packaging??? Pls..., Come on!!), 2nd-sorucing issues, outdated designs, bloated inventory, and 50% projected drop in orders in their wireless products in Q1/98.
Since ANAD problems were mainly focused in the wireless market and were company-specific, VTSS stock was unaffected. In that market, ANAD's focus is mostly low-cost/high vol. RF PAs for AMPS/GSM/TDMA/PDC/CDMA cell phones or base stations. ERICY/NT/QCOM/NOKA/LU are their customers. QCOM is a major customer. No wonder it dropped. They also sell into SONET, CATV, and DBS markets but those markets are not as cost/size-sensitive as wireless phone market.
VTSS ICs are used in down-to-earth applications(!!!) mostly in the networking/telecom/ATE/instrumentation apps. They are also an ASIC foundry for GaAs ICs. While VTSS is speaking of mfring. ramp up and cannot wait to get their new factory on-line this Summer, ANAD is talking about cutting factory utilization.
QCOM has a tough road ahead in the H/S market. More on this later.
Clint |
