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Technology Stocks : LSI Corporation

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To: DanZ who wrote (14498)	8/23/1998 6:51:00 PM
From: BWAC	Read Replies (2) of 25814

LSI/Symbios From my talk with LSI IR on Thursday I found the following: 1. Symbios did farm out some of their "higher end" manufacturing. LSI can and will now do this in house at Gresham. However Gresham has been put off coming online until December. 2.The purchase of Symbios will be done under the purchase method. ie. some sort of goodwill will be booked. 3.Previously I have theorized that our 15 price now is made up of 9.50 "old LSI" plus 5.50 of Symbios. And I stand by that. Yes there will be no "net" change in assets, book value etc. But from the info we have, we know sales of Symbios were 600+ million and they were supposedly profitable by 60 million. So IF IF IF, as LSI thought, Symbios sales and future earnings potential were worth 5.50 per LSI share, then the old LSI must be only valued at 9.50 right now. Which I think is ridiculously low. Symbios could possibly add 40 cents to earnings if sales and margins stay the same. I think my theory is based more on the increasing sales and earnings potential (hopefully) than on book value changing

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