bloomberg blames it all on toshiba!
Rambus Rises 4.2% as Toshiba Says Production to Begin
Mountain View, California, May 13 (Bloomberg) -- Shares of Rambus Inc., a designer of high-speed computer chips, rose 4.2 percent after Toshiba Corp. said it plans to mass-produce memory chips based on Rambus's proprietary technology.
Rambus rose 3 7/32 to 78 3/4, and earlier reached 81 3/4. The shares surged 15 percent yesterday after Tokyo-based Toshiba said it began preliminary production of the chips and will start full production in the third quarter.
Mountain View, California-based Rambus licenses its high- speed technology to computer memory and microprocessor makers including NEC Corp. and International Business Machines Corp. and will receive royalties once production begins.
''Toshiba caused the rise, but Rambus will be a niche architecture until the end of the year,'' said Drew Peck, an S.G. Cowen & Co. analyst, who rates Rambus a ''buy.''
Intel Corp., the world's biggest semiconductor maker, is promoting Rambus technology to the computer industry and has given tens of millions of dollars to memory chipmakers to upgrade their factories.
Intel needs to ensure that computer memory and other personal computer components keep up with the speed of its new microprocessors. It is using Rambus's technology in its new Camino chipset, which acts as an intermediary between a computer's memory and processor.
Last month, Rambus shares fell 4 percent after Intel said that introduction of Camino would be delayed a few months.
Peck said that Rambus shares will be volatile until Intel comes out with specific chips that require Rambus technology and other the chipmakers follow suit. Even with the two-day run-up, its shares are still down 27 percent from a record 109 15/16 on Jan. 8.
''The stock will be all over the place with every rumor, innuendo and nuance,'' Peck said. ''I'm still relatively upbeat about Rambus. Intel has a lot at stake here.''
May/13/1999 16:45
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