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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Donald Wennerstrom who wrote (34511)	4/2/2007 10:40:10 AM
From: Donald Wennerstrom	Read Replies (1) \| Respond to of 95757

Broadcom may rise 50 pct post-options mess-Barron's Reuters - April 01, 2007 1:21 PM ET NEW YORK, April 1 (Reuters) - Broadcom Corp. (BRCM) shares may rise 50 percent as demand for its semiconductors rise, and the company puts problems over backdated stock options behind it, Barron's newspaper said in its April 2 edition. Irvine, California-based Broadcom in January said it would take a $2.22 billion charge against 1998 to 2005 to fix its accounting for the improper backdating of stock option grants. It said former chief Henry Nicholas bore "significant responsibility" for the lack of adequate controls in the option granting process, but did not personally benefit from the restated grants. Barron's said JPMorgan analyst Shawn Webster estimates the market for the kind of chips that Broadcom makes is $27 billion, seven and one-half times Broadcom's sales last year, and will grow 26 percent annually over the next five years. The newspaper said Broadcom is investing in advanced, smaller chips that will carry more features and use less power, a necessity for the smaller cellphones that are becoming more popular. Broadcom has also had good luck defending chip patents, it said. Barron's said Broadcom shares trade at a "reasonable" 21 times projected 2008 earnings. It said if the shares traded at their 32 peak multiple over the last two years, the stock could trade at $48. It closed Friday at $32.07 on the Nasdaq. According to Reuters Estimates, analysts on average expect Broadcom to post a profit of 90 cents per share in 2008, equating to a 35.6 price-to-earnings multiple. Broadcom shares traded as high as $50 last March, and $183.17 in August 2000.