Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : Le coin des francophones -- Ignore unavailable to you. Want to Upgrade?

To: PROBABILITE who wrote (19949)	6/19/2000 9:55:00 AM
From: faro	Respond to of 77509

Un autre jour ca sera le contraire. Tous les techs vont monter et RMBS va baisser, j'ai bien confiance que ca va arriver. Faro

To: PROBABILITE who wrote (19949)	6/19/2000 9:58:00 AM
From: sirinam	Respond to of 77509

Pour ton info PROB [BRIEFING.COM - Damon Southward] Since coming public three years ago, Rambus has been a trading vehicle for active investors. On Friday, the stock experienced turnover of 64.3 mln shares, or 12 times average daily volume, after Rambus announced that Toshiba would pay the company royalties on synchronous DRAM (SDRAM) and double data rate (DDR) SDRAM chips manufactured by Toshiba. The intriguing aspect of this story is that Rambus is receiving a higher royalty rate for DDR memory -- a competing technology that Rambus had no hand in developing; at least, not directly. Trading Points News of the Toshiba licensing agreement catapulted Rambus shares 47% higher on Friday, on 15 mln more shares traded than the Nasdaq's second most active stock. The surge in price and volume occurred despite most investors having little understanding of the true implications of the agreement. Rambus is what's known as a fabless semiconductor company. The Mt. View, CA-based company develops chip interface technology to enhance the performance of high-speed chips, which in then licenses to semiconductor manufacturers and box makers. Since Rambus came public in May of 1997 at a split-adjusted $7 9/16 a share, the stock has been a favorite of momentum investors. The issue finished its first day of trading up 152% from its offering price. Might seem hard to believe now, but in those days a first-day double was front page news. The company garnered its initial notoriety as the brains behind the chips in the popular Nintendo 64 game machines. Although Rambus did not manufacture any of the graphics semiconductors used in the product, through its relationship with Silicon Graphics (SGI), Rambus earned royalties on three of the four chips used in the Nintendo 64. While the SGI relationship put Rambus on the launching pad, it was the company's affiliation with Intel that sent the stock into orbit. The two companies have been working together since 1996 to develop a new chip to increase the speed of memory retrieval for computers. After several lengthy and costly delays, the Intel 820 chipset was finally released in November of 1999... Technical snags related to Rambus technology could potentially result in over $500 million dollars of lost profits by chip and computer makers. In May, Intel announced that it will replace up to 1 million defective motherboards due to problems with a component known as a memory translator hub (MTH) that allows communication between SDRAM and the Intel 820 chipset. The ride in Rambus shares has been rewarding. Investors who purchased the stock three years ago at its first-day opening price have seen the issue soar as much as 1870% (based on March 14 high of $117 3/4). But three years can be a lifetime in the tech world. The world's leading chip makers -- including Rambus ally Intel -- have begun to promote the next generation memory technology. Concerns that DDR would soon overtake the Rambus technology as the industry standard contributed to a 68% decline in Rambus shares between March 14 and April 18. However, the licensing deal announced Friday with Toshiba has the potential to make Rambus a franchise stock. By agreeing to pay royalties on DDR memory, Toshiba assists Rambus in validating its assertion that it is entitled to be paid royalties by any company that produced SDRAM memory and controllers over the past ten years. Rambus has already filed suit against one chip maker -- Hitachi -- alleging patent infringement. That list could eventually include names such as Micron, Samsung, IBM, and even Intel. If things play out the way Rambus hopes, semiconductor makers will eventually pay the company royalties on a variety of competing technologies, based on the premise that these technologies have actually been built on the back of intellectual property owned by Rambus. The Toshiba agreement may convince other semiconductor makers to negotiate settlements with Rambus. Others will decide to take their chances in court, which could take several years to play out. Wall Street has responded to the Toshiba announcement in a very positive way. On Friday, Morgan Stanley Dean Witter analyst Mark Edelstone upgraded the stock from OUTPERFORM to STRONG BUY. This morning, the analyst raised his 12-18 month price target from $125 to $200, saying that he believes the company could produce a long-term net margin of at least 55%... Fiscal year 2003 earnings estimates are raised to a range of $4 to $6 per share, more than double the analysts' previous estimate. Outlook: Rambus shares are now back on the radar screen of investors. The stock will be characterized by high volume and extreme volatility over at least the next two weeks as traders look to squeeze every cent of profit out of the stock on both the short and long sides. Trading Tip: RMBS has a history of making some of its biggest gains on days that the stock trades lower at the open. A gap down, followed by quick rebound into positive territory, is often a signal that momentum players are focused on running the stock that day.