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

To: Brian B. Cole who wrote (13912)	10/14/2000 1:42:11 PM
From: bacchus_ii	Respond to of 275872

Brian RE:<AMD Stock Problems. The current problem with AMD's stock price is the margin on their chips that they just reported. It Stunk.. They need to get their ASP above $100.00.> WHY? ASP is meaningless if not narrowed to a market segment. If we could compare AMD to Intel ASP in value PC or in high-end PC, ... etc then ASP would be more meaningful. AMD's ASP would be terrible if it does include embedded processors. Anyway, when WS decide to push a stock UP or DOWN they do it. Then anal-cyst says all sort of thing until they converge to a small set of possible reason for the move. The final choice is then kept and spread as much as possible. It became the "well accepted statement" and makes you look weird if you don't believe it. It as nothing to do with fundamental of the given stock. Weird Gottfried

To: Brian B. Cole who wrote (13912)	10/14/2000 2:21:19 PM
From: niceguy767	Respond to of 275872

Brian: I'd agree that ASP's were a problem if AMD had reported an earnings loss in Q3...But not only did AMD meet their target of 3.6 million K7's (which apparently the street by its negative reaction to July's Q2 report did not think they would do), they did it while delivering record revenues and earnings...so ASP's don't seem to be a significantly negative problem in Q3... A AMD has introduced a substantial "new line" (i.e. K7's)over the past year that not only didn't draw on the coffers in the first year, but in fact contributed handsomely by all accounts to the bottom line in the first year...As you know, it doesn't happen that way with tech products all too often...Once again, current ASP's don't seem to be negatively impacting the bottom line... AMD's Y2001 target seems to be to achieve about 9 to 11 million K7's per quarter...so one can expect the "margin pressure" to subside after Q4 once the leap from a base of 3.6 million (and the ASP pricing pressures associated with ensuring the success of such rapid expansion) to 8 million K7's has been established and where required incremental growth will level off owing to the capacity constraint...In fact, assuming 7.6 million Athys in Q4, which I certainly do, one can expect that ASP's will firm throughout Y2001 owing to a less formidable incremental sales target and owing to thenarrowing of the rather substantial pricing gap between AMD and its competitors, the current gap being close to $100... Sorry...I just don't get the negativity implied by the current $22...Nothing but positive performance for 4 successive quarters despite formidable obstacles along the way...On the heels of each record breaking quarter, the Hale-Boppers have contrived a new impending set of insurmountable hurdles for AMD, and for 4 successive quarters the Hale-Boppers have been proven wrong about the lethal nature of their ill-contrived hurdles,if profitability is the measure of their accuracy... At $40, imho, the hurdles you have defined would be more than adequately factored in...At $22, my guess is that maximum Fudd, "market crosscurrents", and an expectation of a negative Y2001 eps are also factored in...As these negative factors are deconstructed over the next little while, I can only believe that much of AMD's lost ground will be recaptured!!!