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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Dr. Id who wrote (26421)	6/16/2000 10:36:00 AM
From: TigerPaw	Read Replies (1) \| Respond to of 54805

If Rambus patents cover all DRAMs, an enabling technology with an open interface, dare I say it fits the manual definition of Gorilla. TP

To: Dr. Id who wrote (26421)	6/16/2000 12:55:00 PM
From: StockHawk	Read Replies (1) \| Respond to of 54805

re: A look back at RMBS - any lessons for QCOM? First off, QCOM and RMBS are very different companies in different stages, but last September RMBS shares took a dive due to delays in a chip release by Intel, and QCOM has been badly bruised by China's CDMA delays. Perhaps it is a waste of time, but it may be interesting to take a look back at RMBS and see what happened. I took a look at the RMBS posts on this board from 9/24/99 through early October. For those who do not remember, this is how it began (note, in most cases names were withheld to protect the innocent): 9/24 "Heads Up.......Rambus snafu!" "I'd take Rambus off the "gorilla" list for the time being with the fatal flaw in its product announced today." "It would be nice to know if this 16 point down day made a buying opportunity, a shorting further opportunity, or is simply a sign to keep away" "I'm not happy to see the recent report and downturn, but I'm not entirely surprised either (this is hardly the first snag or delay)" Observation: the stock fell hard on 9/27 and it looked like a disaster. Today, after a 4:1 split, RMBS is up approximately 50% on news of an agreement with Toshiba. It is currently trading at $86 per share. Share prices noted below are split adjusted. It is interesting to look at a stock chart. I wish I could post the proprietary site I use but I can not. The link I am about to provide is NOT split adjusted and it does NOT have today's price (which would be close to $350 pre split). What it does show however, is an almost flat line for the period from August to February (the line will appear even flatter on a post split chart). What is significant about that is that it puts into a longer-term perspective the movements of last fall. stockcharts.com[DD][PB50!B200][V C60][I] Back to the thread: "From what I'm gathering, this is little more than a time-to-market delay. RMBS may take a few slings and arrows, but they don't look like spear catchers in my view." [chaz] "IMO, the market will react, cooler heads will buy, and things will be just fine." [chaz] An analysts downgrade is considered: "Niles concerns with Rambus/Intel/Taiwan/Motherboard/Camino are certainly legit for the short term. ..After all, he went from a Buy to a Long Term Attractive. What is long term these days? A few months, a few quarters...Gorilla Gaming long term investors realize that a product delay of one or two quarters could provide some discomfort on the short term front, but longer term.........what's a quarter or two if one has the long term belief that Rambus is reality?" [BB] Fundamentals, not FUD are considered: "To summarize, all the product adopters are just as motivated today as yesterday. All the members of Rambus's value chain are just as motivated. Fundamentally, there's been no significant change in the evolving story of this gorilla wannabe."[MB] 9/27 rmbs downgraded by Lead Underwriter, Morgan Stanley Observation: RMBS closes under $15 and NEVER closes that low again. Those who sold on the downgrade were hurt. Chaz was unphased: "MS, the lead underwriter for RMBS now downgrades. Ho hum. Boys and girls, this news just doesn't move me....if anything it's designed to give their sizeable sales staff a reason to call all their RMBS holders and get them to churn." [chaz] Observation: But naysayers are plentiful: "Frankly I think the price still needs to drop considerably to present a reasonable risk/reward scenario" "I will be liquidating my RMBS and putting the resources into a better Gorilla candidate, perhaps GMST, where the risk/reward, noise/signal ratios are clearer and more favorable." from theStreet.com: "Bob Fusco, manager of DRAM marketing for memory chipmaker Hitachi (HIT:NYSE), one of the most vocal Rambus opponents, expects to see a lot of existing Rambus-based computers on the market soon at fire-sale prices.. "They have the most to lose here if [Camino] is delayed," Fusco says. "Intel won't go out of business, but it could have that effect on Rambus." from a cross post: "I checked again with my source about whether 'cancelled' meant that the current chip was stuffed but that a redesign was in progress. Here's what he had to say: Intel's working on their exit strategy right now. It's all about saving face, but Camino is dead and the whole Rambus programme with it." Cooler heads do prevail from Redherring.com "Investors flat-out overreacted to news that Intel (Nasdaq: INTC) is delaying its 820 chip set... The bottom line: Rambus is still positioned to make a fortune." "This delay in Rambus is a buying opportunity" [JDB] Observation: RMBS, which has always been a very volitile stock was not "dead money" after the crisis above. In fact, it rose in dramatic fashion twice. From $15 in Sept. to $115 in March and now from $38 mid April to $85 today. Are there any lessons here? Does the market overreact to bad news? Does that present a buying opportunity? Is there a Santa Claus? StockHawk