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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: david_langston who wrote (10069)	9/23/2000 10:56:39 PM
From: niceguy767	Read Replies (1) \| Respond to of 275872

david: Great question...Think I'll sleep on that one...and at the same time prepare an entry for Goutama's eps contest...as they are related assignments...Be back tomorrow with a stab at your questions...

To: david_langston who wrote (10069)	9/23/2000 11:29:52 PM
From: RDM	Respond to of 275872

AMD needs sustained consistancy in excellence for highest valuation. While it is true they have had excellent result the past few quarters, but investors reward most sustained results through many quarters. Look at stocks like Cisco. Cisco's extemely high valuation is hard to explain except for consistant excellent results. I believe we will see continued inprovement in valuation proving that AMD consistantly improves. In the short term I expect that AMD will go up in November and December.

To: david_langston who wrote (10069)	9/24/2000 11:42:39 PM
From: DRBES	Read Replies (5) \| Respond to of 275872

<font color=red>A DARBES RANT: re: "I'm asking what hopefully is a just hypothetical question to elicit discussion about the minimum threshold needed for AMD to gain some respect. I have crossed fingers that the minimum WILL be exceeded. Anyone feel free to jump in here." The question that you ask is one that the pundits, ANALysts, and portfolio managers dwell on and would seem to be not only an excellent one but also fundamental to just when or even "if" AMD is going to ever progress upward in share price. I would like to take the seemingly ironic position that it is unimportant and misses the whole point. inteL has approximately twenty-five times as many shares out there to spread its earnings over and AMD is in the process of taking a significant portion of its top and bottom lines away. Even if only a small fraction of this (and I am betting heavily and in a very real way that it will not be such a small fraction) is translated and spread over the very much smaller number of AMD shares the effect will be humongous. When will the full effect start to be felt, I honestly do not know but it is already oncoming. A dime away from inteL's earnings will translate, somehow, to between one or two dollars per share in earnings for AMD. The relationship in this translation should be more sporadic than linear but it would appear to oncoming and progressively more inevitable. It is as if Rodney Dangerfield (AMD is, after all, often called the Rodney Dangerfield of the semiconductor industry.) were to appear on the Tonight Show, tell a very flat joke and after getting "no respect" from the audience, pull out a statement from his broker showing his net worth to exceed $200 billion; and then walk off the stage asserting that he does not need any respect. The parallel may be flawed but when AMD starts to report several dollars per share in earnings the market, a place that always seems to eventually say "SHOW ME THE MONEY" will probably let the shares appreciate. In due course, AMD may also get some respect. PLEASE SOMEBODY COMMENT!!!! Patient Regards, DARBES

To: david_langston who wrote (10069)	9/25/2000 7:57:32 AM
From: niceguy767	Read Replies (1) \| Respond to of 275872

Dave: Couldn't get through to SI for some reason all day yesterday, but here are my thoughts, a day late, on your thought prokoking questions. Frame of Reference: A $3 billion tech company with a growth rate of 25% and superlative forward looking prospects would normally command a p/e multiple of 25 or more…For a company trading at $25, that would imply annual earnings of $1.00. Inasmuch as AMD's Q1+Q2 eps of $1.15 ($0.55 and $0.60) already exceeds $1.00, one might conclude that a disaster scenario for AMD is factored into its $25 price, a disaster scenario that the market is expecting to unravel in Q3 and Q4 if annual earnings are not to exceed $1.00…For such a disaster scenario to surface, Q3 earnings would have to be significantly lower than Q2's of $0.60…and for that to occur, Athy shipments would have to level off at Q2 quantities of 1.8 million and ASP's would have to decline considerably…Obviously the market is wrong… Given Athy incremental growth of 400,000 units in Q1 (from 800,000 to 1.2 million) and incremental growth of 600,000 units in Q2 (from 1.2 million to 1.8 million), which resulted in pre-tax earnings of $0.57 and $0.75 respectively, obviously incremental growth of 1.8 million Athy units (to 3.6 million units, a 300% quarterly incremental Athy growth rate) would be sensational,outstanding even, particularly in light of INTC's recently announced apparent difficulties in Q3, and could result in pretax earnings well in excess of $1.00…an event that would provide escape velocity for the stock price… It is within the above context that I would conclude that the current market is factoring into AMD's current price of $25 a significant shortfall in AMD's target for incremental Athy shipments in Q3 of 1.8 million units (a 300% gain in incremental shipments). The current market seems to be suggesting that Q3 incremental Athys will not significantly exceed Q1's of 400,000 and Q2's of 600,000 and given the overall perception of some analysts of a declining global market demand, seems to be pointing towards Q3 incrementals of 800,000 at tops or 2.6 million Q3 Athys in total… So, in answer to your questions, any Q3 Athy number below 2.6 million, might well support a lowere eps than Q2's $0.60 and a leveling off in AMD price around the current $25 level…Contrarily, any number above 3 million (i.e increment of 1.2 million Athys) should generate for the 4th successive quarter record earnings and some significant AMD price strength…If AMD meets its 3.6 million target for a phenomenal incremental increase of 1.8 million Athy units and sticks with the Q4 forward guidance target of 7.2 million, then fasten your seatbelt…Outstanding profitability for the foreseeable future would be intimated and an instant price revaluation would likely take place on October 12…