S3 (A LONGER TERM PERSPECTIVE) Message Board

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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE)

SIII 0.0001000

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May 12 5:00 PM EST

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To: J L Segal who wrote (11269)	6/19/1998 11:29:00 AM
From: R Stevens	Read Replies (1) of 14577

They also own an equity position in a Taiwanese semiconductor co. As I understand it, this position is listed on the balance sheet at the price paid. The reality is it is worth much more. When it goes public in Taiwan, S3 will realize a huge gain. Thus the following graph of TSMC's recent upturn is very relevant. As the values of Taiwanese fab's go back up, S3's book value goes up also. I was reading the book, "The Whiz Kid Of Wall Street" about Matt Seto. A young value investor who is supposed to be the next W.Buffett, yeah right. Anyway I found this quote on book value interesting...he talks about finding companies below book value, then he makes a case for an unusual situation that occasionally occurs when a company's assets are understated: For an investor, it's the best of all worlds to buy a company whose book value is higher than its stock price but below its true breakup value, which is what you'd get if you sold all the company's assets separately. Here is the graph of TSMC cbs.marketwatch.com Finally, here is an article about a potential merger with UMC and TSMC. I believe UMC is the co owner with S3 of the subsidiary fab. A merger could make these companies even more competitive on a global basis: pubs.cmpnet.com (any comments or corrections on this information are welcome) Most important for S3's stock price growth will of course be the success of Savage3D and the new embedded DRAM notebook chips(due out around year end). Still, it is very nice to have this kind of an asset cushion. As my friend said, "It is the ultimate value play." Good Luck, RS

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