Neomagic Corp. (NMGC) Message Board

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Technology Stocks : Neomagic Corp. (NMGC)

NMGC 0.00730

-43.8%

Nov 7 9:54 AM EST

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To: SIer formerly known as Joe B. who wrote (2584)	2/19/1999 12:51:00 PM
From: The KOF	Read Replies (1) of 3645

APPARENTLY THEY DOWNGRADED BECAUSE A NEW ANALYST IS COVERING IT NOW AND HIS OPINION DIFFERS FROM THE OLD ANALYST.... NOTHING TO DO WITH THE COMPANIES CURRENT OR FUTURE RESULTS..... THAT'S JUST OUTSTANDING. ALSO OF NOTE IS HE STATED THE EPS AT .33 MISSING ESTIMATES... WRONG... WRONG... WRONG... AND THE DOUBLING OF EXPENDITURES IN R&D FOR THE QUARTER ARE NEVER MENTIONED AT ALL AS HAVING A NEGATIVE EFFECT ON EPS, JUST THE VERY SLIGHT DECLINE IN GROSS MARGINS..... IN SHORT THIS GUY IS AN ASS WHO DIDNT DO HIS HOMEWORK. Research dated prior to September 1, 1998 was prepared by an entity that was acquired by BancBoston Robertson Stephens Inc. NeoMagic reported FQ4:99 EPS of $0.33, one penny below our and Street consensus. Revenues of $72.0 million were ahead of our $70.8 million estimate. Gross margin at 39.0%, was 97-bps below our estimate, causing the EPS miss. Neomagic continued to show strong market penetration with an estimated 50% market share in notebook graphics accelerator market in FQ4. We estimate that unit volumes were up about 35-40% with a 7-8% ASP decline. The company expects systems to ship with its upcoming 3D product in Q2. The company also announced the acquisition of ACL, an Israeli company and Mitel Semiconductor's Optical Storage division. We believe that these acquisitions will position the company in the emerging DVD and camera markets. We are slightly reducing our revenue estimates for F2000 from $311 million to $305 million, with EPS unchanged at $1.36. We are adjusting the rating from a Strong Buy to a Buy, driven primarily by a change in analyst coverage.

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