Larry, I have long disliked LSI fundamentally. I think their main products are vulnerable to Asian competition and, in fact, many giant Asian chipmakers are entering LSI fields as memory goes to hell in a handbasket. The most dangerous product, IMHO, is embedded DRAM, where a DRAM chip is combined with several other types of chips. LSI is no dummy and they are working with Micron Tech to build embedded DRAM of their own. However, so far, I haven't seen anything come out of this partnership while Hitachi, Mitsubishi, and Toshiba are making prototypes and in some cases, sending out test chips. So, they may be able to hustle past the competition as they have in the past, but it will cost them profit margin to do so. And I think the odds are against them. Shorter term, they could be o.k.
Harrah's looks toppy to me, but not nearly as much as Hilton. Both cos do have fine mgts., but mgts. do not control the economic cycle or the willingness of competitors to build non-economic properties. In other words, just as I think that Compaq is better managed than most pc cos., they are not making any money for the same two reasons. Overinvestment is killing pc boxmaking and I think it will kill casinos. It always has in the past. We have been overpriced and the hotels have been too full for an awfully long time. MB |
