Chip,
Agree. What is most important for 3dfx is to execute, not
buy backs.
I have owned a lot of companies over the years and been through
my share of buy backs. IMO buy backs from a long term holder's
perspective are nothing but stop-gap. I've never had a stock I owned
jumped significantly, and hold the jump, long term from a buy back.
A buy back is good to force a bottom, and agree with Sun that they
should then time the buy back. As of late, Xlinix has been doing
this with their buybacks. And that stock tends to have strong
support at $30-$32 a share. And, they are a semiconductor company
by the way.
Personally, would rather see 3dfx do a stock buy-out of 3dlabs at
this point and take out some of the competition. Also, they could
deduct a considerable amount of "good-will" from such a purchase.
Anybody want to comment?
3dlabs stock price is now at a heavy discount, and they already
have the OEM parts and agreements. Plus, they add another potentially
high margin CAD market. SIII does not have a strong enough high-end
pipeline of products to stay of ahead of the competition. ATY
'thinks' they are dominate, and frankly if their shares weren't sold
in Toronto I would short them now.
Would like to comment, though, that 3dlabs probably screwed themselves
by entering the OEM market. This has me worried about 3dfx doing
the same thing. As soon as 3dlabs diverted attention to the Permedia
series, they went down the tubes. Evans and Sutherland caught up to
them in the CAD world: bad move. 3dfx had better stay focused on
putting out the best gaming cards around and use OEM only as a steady
cash flow (and for continued sales of older parts). Anything that
diverts from that is detrimental.
Waldeen
So how do you guys find so much time to write these posts anyway? |
