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Technology Stocks : SMSC Standard Microsystems
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To: Robert Salasidis who wrote (302)9/23/1998 9:38:00 PM
From: KEN MATSON  Read Replies (2) of 335
 
"You can't go swimming unless you get in the water." There is a lot of potential here for the following reasons:

1) The market senses that PC sales are now trending up; SMSC sells 90% to this market.

2) SMSC is now focused on a business that they have a lot of experience with.

3) Looking ahead a year, SMSC may do $13/sh. in sales. I would hope that they could net $1.50. At that point the market may be discounting earnings of $2.00. What P/E might the market be willing to grant?

All of this is purely conjecture, but with a book of $11/share, no debt, and a reasonable basis for expecting sales increases over the next 2 years, it is difficult to make a case for the stock to go down.

Of course we can't know the future until it happens. In the meantime, if you want to swim......
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