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

To: DlphcOracl who wrote (28540)	7/22/2000 5:11:49 PM
From: Thomas Mercer-Hursh	Respond to of 54805

QCOM's plight is identical to Rambus Not really. RMBS had a lock on a particular type of attractive memory, but it was uncertain for some time whether or not this type of memory would be widely adopted, especially since there were some problems achieving expected gains for a while. It now appears that they are past the hump, that their type of memory will be widely adopted, and things should be rosy for a while. But, given the nature of RAM technology and the market, it is quite possible for some new RAM technology to come along, become popular very quickly, and close this window. It won't happen overnight or we would already know what the potential displacing technology was, but it is certainly a possibility. RMBS needs to hope that not only can it ride the current tornado, but that it can use the position it gains from doing so to create the next hot technology as well. On the other hand, in QCOMs market, while there seem to be more alternatives than there are short acronyms to identify them, ALL of those future technologies depend on CDMA, which is QCOM's. QCOMs gorilla position is not dependent on X or Y or Z being the ultimate victor or even on any one standard emerging as a victor, but simply on the world getting on to the next level of wireless communication. QCOM is vulnerable to the rate at which this will occur, particularly if large sectors persist in trying to chase vaporware options when equally good or better options are already available for deployment, but as long as the world makes a substantial move to a next generation wireless, everything we know at this point indicates that CDMA will be at the core and QCOM will be the beneficiary. One scenario or another may vary the degree of QCOM's benefit, e.g., how dominant they are as an ASIC producer and whether or not they need to pay counter-royalties, but I just haven't heard anything that would suggest they can be anything but highly benefited unless the bulk of the world decides that current technology is fine with them.

To: DlphcOracl who wrote (28540)	7/22/2000 5:14:51 PM
From: DownSouth	Read Replies (1) \| Respond to of 54805

QCOM's plight is identical to Rambus -- until there is clear-cut evidence that CDMA is rapidly gaining market share outside the US, it will be range-bound between 55-80 (IMO) DO, QCOM's situation is not comparable to RMBS in any respect. First of all, QCOM's fate is not in the hands of a single company (like INTC) and that company's ability to integrate their product into their products. Also, QCOM's ASICS and IPR market place is much more rapidly expanding than that of RMBS and is not dominated by a single or duopolistic (WINTEL) architecture. Nor is that market as mature as the WINTEL marketplace. until there is clear-cut evidence that CDMA is rapidly gaining market share outside the US, it will be range-bound between 55-80 (IMO) All the hoopla about WCDMA is, to me, clear cut evidence that CDMA will rapidly gain market share worldwide. I realize that I substitued "will" for "is", so how you evaluate the importance of recent events may depend on what your definition of "is" is. <vbg> You make good points, but I do not see level of risk that you seem to. I also like your list of stocks, but believe that QCOM is a great investment in terms of risk/reward.

To: DlphcOracl who wrote (28540)	7/22/2000 5:36:04 PM
From: Uncle Frank	Read Replies (2) \| Respond to of 54805

DO, you make some good points and are focused on some good stocks, but let's try to put this discussion back into the framework of the Gorilla Game. The fact that qcom has declined from a high of 200 to 62 13/16 has no bearing on its prospects, only its past. Qcom is the Gorilla of cdma, the fastest growing air interface in the world based on sub acquisition rates. Granted, this rate appears to have dropped below Tornado levels, but that doesn't negate the pongid status they gained through developing their discontinuous innovation. The fm advises to hold the Gorilla until there is a threat of substitution, and there isn't one in sight. What is in sight is a beauty of a Tornado related to 3G beginning to take shape. This should kick off in early 4Q00, with installations going on line in Korea, a very exciting prospect. Your suggestions may make sense from a trader's viewpoint, but as a Gorilla Gamer, this would be a totally inappropriate time to reduce my holdings in Qualcomm. jmho, uf

To: DlphcOracl who wrote (28540)	7/23/2000 1:20:28 AM
From: Bruce Brown	Read Replies (2) \| Respond to of 54805

DelphcOrcl wrote: [At present, that is not happening. QCOM's plight is identical to Rambus -- until there is clear-cut evidence that CDMA is rapidly gaining market share outside the US, it will be range-bound between 55-80 (IMO)] Obviously, I should read ahead to see if anyone addressed this issue, but I have to assume you are only talking stock price being held at bay and not in any way trying to compare the technology adoption life cycles and IPR of either company being in the same situation at any given time in history. Rambus? Gee, anyone who was willing to sit on their shares for a measly little 6 to 8 months after Intel delayed their boards or whatever the heck happened (I've forgotten at this point) were rewarded quite well. Maybe that's too long term for you, I don't know. $60 some odd dollars a share to $400 and nose bleed before anyone could get their belts fastened. [I would prefer to park my money in stocks that are dominating their space, with quarter after quarter of rapid growth, in sectors that are rapidly expanding. Some of these stocks can be held for 1-2 years, others will be held for 6-12 months.] I agree with you having stocks that are marching on quarter after quarter with tremendous growth, dominating their space and are in hypergrowth sectors are a 'must' portion of my portfolio. So are the cash printing companies like some of our more mature gorillas such as Intel, Cisco and Oracle. However, some of those young hypergrowth companies that I am thinking of are exactly the kinds of candidates in gorilla games that I want to park my money for more than 6 months to two years. Qualcomm is an 'obvious' choice for gorilla gamers who are willing to let the events unfold over the next few years and are willing to let management execute during that time frame. Good grief, what an investing sin to have sold Cisco after a couple of years of hypergrowth in the early days! 168,000% return to date since the IPO. That wasn't accomplished by early investors through chase and tax, chase and tax, chase and tax, chase and tax. It's a stock we all dream about having owned from day one. The power of compounding in a few great investments using gorilla game strategy or strong royalty position has proven in the past to beat the chase and tax strategy quite easily with out having to always be hopping in and out of the latest hot thing. Obviously, different strategies work for different folks, but gorilla gaming is not a short term strategy. Cisco didn't do it overnight. Microsoft didn't do it overnight. Intel didn't do it overnight. Oracle didn't do it overnight. EMC didn't do it overnight. Sun didn't do it overnight. Siebel isn't doing it overnight. i2 isn't doing it overnight. Gemstar isn't doing it overnight. Network Appliance isn't doing it overnight. Brocade isn't doing it overnight. Broadcom isn't doing it overnight. Did any of those companies do it in 6 months? 12 months? I forget to ask, have you read the books "Chasm" and "Tornado"? Quality reading in my opinion about the time frames required for gorilla game investing. Did anybody say Qualcomm was going to do it overnight? BB