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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: Lee Lichterman III who wrote (28974)	9/24/1999 7:15:00 AM
From: IQBAL LATIF	Read Replies (2) \| Respond to of 50167

FT..Chip shortage hits mobile phone market By Louise Kehoe in San Francisco, Paul Taylor in London and Christopher Brown-Humes in Stockholm On your letter today <<Semis rallying hard just because they might have thier first profitable quarters to these levels is ridiculous. Micron loses money for 7 quarters then triples because they might have one or two good quarters. The foreign fabs are gearing up and there will be a lag time where MU can make money but charging a million bucks on your credit card so you can make a couple thousand in payments for two months before you have to start charging another couple million is not good financial planning <ggg>>> FT further writes that... Manufacturers of mobile phones, hand-held computers and other electronic goods may not be able to meet demand due to a shortage of flash memory chips. Some mobile handset makers, including Alcatel of France, have indicated that their output is being constrained by the shortage of key components. The world market for flash memory chips, lightweight storage devices that retain memory when power is switched off, is expected to reach $3.24bn this year, up from $2.49bn in 1998. IC Insights, a semiconductor market research group, is forecasting $4bn for 2000. Flash memory chips are manufactured by Intel, the world's largest chipmaker, and a handful of other US, Japanese and European companies. Alcatel will lift its GSM handset production to between 10m and 11m units this year, but it could have sold more had components not been in short supply. However, Nokia of Finland and Sweden's Ericsson said they had enough components to meet production this year. "We have secured the supply of components," said Ericsson. According to Intel, the largest flash memory chip maker, global demand jumped from 160m units in the fourth quarter of last year to 240m units in the latest period. In 1997 and 1998 demand was flat and prices were falling, stifling new investment. This year the price of an 8 Megabit flash memory chip has doubled to about $4. Benny Ginman, a director of Intel in Europe, said the US chipmaker was still able to meet commitments to customers. But he added that Intel was "not in a very good position" to take on additional orders. Brian Matas, of IC Insights, said that shortages of flash memory chips were widespread. Advanced Micro Devices, the second largest producer, was "sold out". The ability of the semiconductor industry to increase production is limited. By shrinking chip dimensions, so that more chips can be made from each silicon wafer, chipmakers may be able to expand effective production capacity, but this would take time, he said. The total memory chip market for 1999 was $28.6bn, up 24 per cent from 1998. IC Insights is forecasting 35 per cent growth next year to $38.5bn.

To: Lee Lichterman III who wrote (28974)	9/24/1999 9:12:00 AM
From: IQBAL LATIF	Read Replies (4) \| Respond to of 50167

Feelings and facts are two different animals, what you want the stock to be and where it is now is based 'unfortunately' on facts and not 'feelings or emotions'...whatever your view is today's second news on MU are as follows for me purely as a trader I do not like to stand in front of these kind of news, specially based on 'my' asumptions which may have been suspect atleast after MU trading and making new highs..??? but people have strong opinions and they don't look for facts but believes.. Shares of Micron Technology (MU) is trading near its 52-week high after 64-Meg DRAM price moved up to $18-$20 range. Prices were hovering around $16-$17, but the earthquake in Taiwan pushed prices to almost $20. Market was already tight prior to the earthquake and now many analysts believe that supply is not likely to increase materially on a near-term basis. This bodes well for companies such as Micron whose average selling price is expected to continue to rise. Some analysts believe that 64-Meg DRAM price might have difficulty staying around $20 for too long, nonetheless, prices have rebounded enough so that MU and others would see a sharp rise in earnings going forward. Just few short months ago, DRAM prices were trading around $3.50. Despite the sharp run-up, most analysts expect MU?s earnings to be somewhat depressed this quarter since the company sold most of the DRAMs at lower prices earlier in the quarter. However, they are positive on future earnings, starting from the December quarter. In fact, Salmon Brothers raised earnings estimate and price target on MU several times over the past couple of months. Their most recent 12-month price target on MU is $120. It is also worth noting that since shares have had a strong run-up over the past few months, it would be normal to expect some pullback or consolidation within the context of its uptrend.