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Technology Stocks : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: DJBEINO who wrote (5116)	6/23/1999 7:21:00 AM
From: Amadeo Mendez-Vigo	Respond to of 9582

Very Good post from "The Motley Fool's Board" ALSC was punished today after the downgrade from Needhams. It is a weak downgrade, because it is price-based and the price target was reached by Needham assigning 70% probablity of the UMC transaction going through. The transaction is a fact, but the analyst has forgotten how he had derived his target. If you read the brokers note, you would find that it is quite bullish and shows that the fair value based on the after-tax value of the investments (UMC, etc) is north of $12. The underlying business of UMC is doing very well and the stock is registering gains day by day in Taiwan (code 2303). None of the analysts pays attention to the fact that apart from UMC (2nd biggest foundry), ALSC has investments also in the 3rd biggest foundry in the world at a book cost of $50m (look in 10-K filings!). The UMC investment was about $60m in the books and more than $500m in reality!! I believe that the broker is very conservative (trying to insure hiimself after ALSC had a splendid run). The market is clearly over-reacting; the stock should not be dropping but should close a glaring valuation gap. I see only upside from these levels. BUY.

To: DJBEINO who wrote (5116)	6/23/1999 8:17:00 AM
From: stock talk	Read Replies (2) \| Respond to of 9582

Maybe this had something to do with the down grade?? Wednesday June 23 4:54 AM ET NEC, Hitachi To Develop News Chips TOKYO (Reuters) - Japanese chipmaking giants NEC Corp (Nasdaq:NIPNY - news) and Hitachi Ltd (NYSE:HIT - news) unveiled a broad alliance pact Wednesday, including a possible joint venture to develop new DRAM (dynamic random-access memory) chips. The two companies said in a statement the tie-up was aimed at sharing hefty development costs for new DRAM chips and raising profitability in their ailing semiconductor divisions, which have been hit by a prolonged market slump and stiff price competition. NEC and Hitachi said they aimed to become the world's foremost supplier of DRAM chips and capture 20 percent of the global DRAM market. Once reaching a basic agreement, they will begin unifying product brands and expanding their ties, the statement said. All DRAM operations at the two companies would be combined in the joint venture, allowing significant advantages through economies of scale and shared expenses. ''The memory market is seeing an increasing concentration of North American, European and Asian manufacturers, making it vital to achieve economies of scale and enhanced technological development while strengthening cost competitiveness,'' the statement said. dailynews.yahoo.com