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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: Jdaasoc who wrote (25765)	7/26/1999 7:30:00 PM
From: Dave B	Read Replies (1) \| Respond to of 93625

Jd, Re: I am going to be back in starting @ 85. You said your desire was to buy in a $95. Message 10630689 Re: It seems that understanding economic fundamentals is not a forte on SI board. Anything else you want to add? Like a specific example of something someone said? Dave

To: Jdaasoc who wrote (25765)	7/26/1999 7:53:00 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 93625

Jdaasoc, I fail to understand the rationale of your decision that $95 is no longer a "good price" but $85 is, based on the fundamental discovery that 50% share of market (I presume the PC market?) is no longer to be considered an actuality in 2001, but will be actuality in 2002. I Would have thought that such FA would reduce the buying price to maybe $50/share (if indeed the assumption of 50% penetration in 2001 warrants a price of $95 or so). The way I see it if we indeed reach 50% of the market in 2002, we are talking of after taxes in the range of $150 MM to $250 MM depending of course on assumptions on the DRAM market in general and the percentage of RMBS revenues that will then be derived from DRAM (some estimate that by then only 35% of RMBS' revenues will be derived from the DRAM market and in that case, the $250 MM figure above becomes closer to $450 MM). In other words, next year (since months hence) how much would one be willing to pay for after taxes income of between $6 to $18 per share? Or to simplify the model further, assuming that the sequential earnings per shares would be $1.0 in 2000, $4.0 in 2001 and let say $8 in 2002 with visibility of these earnings going to around $20 within two years after that? If that stream of revenues is worth $85 today, what would a stream like $2, $5.5, and $12 in the same years be? Not that any of these numbers are at this point "known", at least not by me. As you may know, personally, I am out of RMBS and will base my reentry on the technical behavior of the stock much more than on the expected fundamental s which are at best "Fuzzy logic" at this point. Zeev