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Technology Stocks : LSI Corporation

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To: Hightechhooper who wrote (12720)	5/31/1998 5:16:00 PM
From: shane forbes	Read Replies (2) of 25814

K: I think the main point in the article is Corrigan's intimating that we are at an inflexion point - PC to Internet, SOC (and once again note it is not easy to duplicate) with the implication of big time S-curves. Lower MPUs and lower DRAMs drive lots of other apps. LSI will benefit from this as consumer electronics gadgets therby proliferate and more importantly as companies use more and more sophisticated chips because they can afford to and soon will need to. As the thread knows, with the "2 LSIs" posts of a few months ago, I think LSI is likewise at a not too uncoincidental inflexion point! Those high volume chips are precisely for the types of apps that Corrigan speaks about. It all gels. Like I said we shall see how the doubting Thomases react over the next few quarters. What happens to the stock price this week or within the next 6 weeks is irrelevant. (BTW Corrigan has a good point about the world through Yen. Again not too uncoincidentally the Yen devaluation was intimated as a reason for the lower revenue in the 10-Q - something like "ASPs lower when translated to US Dollars". However shouldn't he redo the past history of 17% global chip growth in Yen? I know it is a long time and currency effects might vanish - but still can we be really certain that the 17% l/t US$ growth rate = 17% l/t Yen growth rate? I don't know. The interesting thing that people must not forget about LSI is that again they are one of the very few that has a substantial part of their production capacity in Japan - who else of the big companies does - a quick check and I think no one. Sure this means LSI is constrained to some extent in terms of revenue growth - BUT the earnings are unaffected and will be there over time and with Gresham the revenue growth in Us$ will be there as well.) Shane (BTW Corrigan saying "sooner than many people think" is using the exact words I used some months ago when I said the semis will turn around sooner than most people think. See and Wolf wanted to know why I was not there at the shareholders' meeting...)

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