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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: FlameMe who wrote (24629)	1/21/2004 6:31:47 PM
From: Dave	Read Replies (3) \| Respond to of 60323

Ross: The increase in the tax rate should've been expected. All the analysts had to do was evaluate SanDisk's Net Operating Losses that were reported in the 2002 10-K. The GM compression combined with increases in marketing could be extremely troubling down the road. While I applaud their "Brand awareness" strategy which I proposed in earlier posts, the question is whether this strategy will lead to higher revenue growth. You must also remember that in Q4 fully diluted shares were a tad over 95m whereas FY03 fully diluted shares were around 85m due to averaging during the quarter. In 2004, there will be over 95m fully diluted shares. Next, while cash is good, SNDK has excess cash on its balance sheet. They need to figure out a place to put it since it is reducing it's overall Return on Capital. In 2004, SNDK will be "investing" that cash in a new marketing strategy which is an "intangible" item.

To: FlameMe who wrote (24629)	1/21/2004 6:52:31 PM
From: Ausdauer	Read Replies (1) \| Respond to of 60323

Ross, 1) The total revenue projections are quite bold for 2004. 2) Margin contraction is expected due to more purchased wafer. This has been harped on in prior Q's (captive vs. non-captive). 3) Tax increase has been commented on for the last 2 or 3 Q's. 4) I don't underestimate possible expansion of licensing revenues. These will grow as the overall NAND market size grows. This also can make up for reduced overall product margins. 5) Operating expenses will go up, but they won't spend $1.3 billion on advertising, that is for sure. 6) At $60/sh the valuation is about $5.3 billion with $1.3 billion in cash. Net valuation about $4 billion. Net income in last quarter was over $100 million. 7) Stock split coming. I don't understand the after-hours sell-off. Aus@2004=cameraphones.com