Hello Nancy,
The best way I can think of to explain why one ought to buy Rambus is to reiterate what REH has said, "infrastructure, infrastructure, infrastructure." Often, it's a matter of alliances, partnerships, and timing. Once an industry decides---in this case, forced---on a particular standard, a better mousetrap becomes irrelevant. Fortunately or unfortunately, that's reality. (There are very capable individuals on this thread that may provide some examples.)
Admittedly, Nancy, the price-earnings ratio is high. Obviously, we've got a lot of "P", and everybody's waiting for the "E". So, why contemplate starting to build a position now? Well, because Rambus is within, say, 6-9 months of "showing us the money." And, the revenues are expected to be absolutely HUGE!. I would wager that you'll see a lot of "E" in the near future. In my view, Rambus has the most dominating type of business: a proprietary standard on an enabling technology, on which a very long value chain is about to form (i.e. high switching costs).
Best of luck Nancy.
K |
