Elmer - Drew Peck has been Reading SCUMbria's posts !
06/15 9:07P (DJ) Chip Maker AMD Shares Rise On K7 Chip Optimism;
Other Chip Stocks Up Story 1344 (AMD, AMOD-D, BRCM, INTC-D, INTC, LSCC, TXN, TXNI-D, I/SEM...)
By Christopher Grimes, Staff Reporter
NEW YORK -(Dow Jones)- Shares of Advanced Micro Devices Inc. rose more than 8% Tuesday on optimism that the company has succeeded with early efforts to manufacture its K7 microprocessor, an analyst said. "There was a flurry of rumors that AMD's early manufacturing performance has been quite good on the K7," said Drew Peck of SG Cowen & Co. AMD (AMD) rose $1.375, or 8.1%, to $18.313 on volume of 3.1 million shares, compared with a daily average of 1.6 million. The chip maker is preparing to send out samples of the K7 chip, which is designed to perform better than top offerings from rival Intel Corp.
A 600-megahertz version of the K7 is expected to be introduced later this year. But Peck noted that AMD has often had great difficulty building chips in quantity. Merrill Lynch & Co. analyst Joe Osha agreed. "I think that on paper the chip looks great," Osha said. "But whether it's a good chip on paper has never been a question. The question now is the same as it was a year ago: Can they make the part?" AMD also announced Tuesday it had closed the sale of its Vantis Corp. unit to Lattice Semiconductor Corp. for $500 million. Lattice (LSCC) shares rose $1.875, or 3.2%, to $60 on lighter than average volume. An AMD spokesman wasn't immediately available for comment. Other semiconductor stocks rose Tuesday after Osha raised his growth estimate for global chip sales to 16% from 12%. Osha's revised forecast is slightly more optimistic than recently-released figures from the Semiconductor Industry Association, which forecast that industry sales growth would be 12% in 1999. The seven companies highlighted in the Merrill Lynch report are primarily suppliers of chips used in either wireless or wireline communications. Big movers among the stocks he mentioned were Broadcom Corp. (BRCM), which rose $9.625, or 9.5%, to $110.625, and Texas Instruments Inc. (TXN), up $5.438, or 4.2%, to $134.688. The Philadelphia Semiconductor Sector Index rose 9.7 to 448.77. Intel, the world's largest chip company, wasn't mentioned in Osha's report. But its shares rose anyway, gaining $1.313, or 2.4%, to $55.688. -Christopher Grimes; 201-938-5253 Copyright (c) 1999 Dow Jones & Company, Inc. All Rights Reserved. Additional Codes (N/CAC, N/DJN, N/DJS, N/DJWI, N/ETDR, N/HIY, N/HYL, N/MMM, N/MNA, N/STK, N/TEC, N/TNM, N/WEI, M/TEC, P/DAR, P/DCO, P/DHS, P/DSE, R/CA, R/NME, R/OR, R/ORG, R/PRM, R/TX, R/US, R/USS, R/USW) |
