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Technology Stocks : LSI Corporation -- Ignore unavailable to you. Want to Upgrade?

To: E. Graphs who wrote (20268)	10/20/1999 1:07:00 PM
From: sea_biscuit	Respond to of 25814

I am not saying anything!<g> Seriously, no, I didn't add. I might switch from the loser SGI to LSI, though. Just waiting for the loser to come up with some new excuses this afternoon before I fold it!<g>

To: E. Graphs who wrote (20268)	10/20/1999 1:17:00 PM
From: MulhollandDrive	Respond to of 25814

E, Found this on the RMBS thread, nice mention of LSI.... Dow Jones Newswires -- October 19, 1999 This story appears in the November issue of SmartMoney magazine. By Gerri Willis It's not just 15-year-olds who are eagerly awaiting the release of PlayStation2, Sony's newest game console, scheduled to hit U.S. stores next September. Wall Street is wild about it, too, sending Sony's ADRs up 104 percent already this year. But Wall Street may be overlooking a side benefit of the PlayStation2: Certain semiconductor makers are also bound to get a bounce from the superfast game machine. Sony contracts with three main chipmakers to supply its PlayStation line. And for at least one of them, PlayStation2 promises to be icing on an already fat cake. That's because recovering Asian economies have spurred chip demand and pushed prices higher in the past 10 months. As a result, semiconductor stocks have jumped 61 percent during that same period. Analysts predict this up cycle will continue through 2000 and 2001 as new technologies such as video for the Web and voice recognition fuel orders for new, more powerful chips. Earnings for the group are expected to grow 43 percent this year, according to First Call, making chips the fifth-fastest-growing sector of the market. That's a phenomenal rebound when you consider that earnings growth for the group slid 24 percent last year. For 2001, earnings should jump another 38 percent. PlayStation2 alone is anticipated to sell more units per year than palmtops or digital cameras, ultimately generating $1 billion in annual sales for the chip industry. Milpitas, Calif.-based LSI Logic (LSI, $59.06) is the chipmaker that stands to gain the most from Sony's newest gizmo. Already, LSI gets about $120 million, or nearly 7 percent of revenue, from the original PlayStation, and the next gaming console should easily push that revenue to $150 million next year, says Morgan Stanley Dean Witter analyst Mark Edelstone, who has a $75 target on the stock. LSI shares have already made a dramatic move this year, more than tripling from their low of $16.13. Even so, the stock still trades well below the chip industry's price/earnings ratio of 42 and the company's earnings- growth estimate of 108 percent for the year 2000. The company has the added advantage of supplying the continuing boom in building the Internet infrastructure. And because LSI has less than 5 percent of its production in Taiwan, worries about the earthquake are overblown. Sony's other two suppliers are less attractive. The biggest, Tokyo-based Toshiba, is unlikely to see a major impact from Sony, because logic chips -- the kind PlayStation uses -- make up only a minor portion of its business, which includes DRAM chips, PCs, disk drives, cable modems and consumer electronics. That's not the problem with Sony's third supplier. Rambus Inc., which designs chips, stands to gain $10 million in royalties from the new game console. But the tiny Mountain View, Calif., firm may be facing trouble in its newest business. Currently, Rambus is offering a promising technology for fixing the PC bottleneck that occurs in the transfer of data between memory and the computer processor. The launch has been plagued by pricing and production issues, leaving the market open to competitors.