Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Texas Instruments - Good buy now or should we wait? -- Ignore unavailable to you. Want to Upgrade?

To: robert w fain who wrote (1946)	10/30/1997 6:49:00 PM
From: Vijay Raghavan	Read Replies (2) \| Respond to of 6180

businessweek.com From Business Week (Next Issue) TI: TOP OF HIS TECH LIST Some on the Street blow hot and cold on volatile high-tech stocks, particularly those of semiconductor companies. But not John Skeen, research chief and senior managing director at NationsBanc Montgomery Securities. He has been a steadfast technology bull--even through the Oct. 27 market meltdown. Skeen is convinced that technology issues will snap back and help fuel the recovery. In the vast high-tech universe, which stock tops Skeen's favored list? He's gung ho on Texas Instruments (TXN), the world's leading supplier of digital signal processors (DSPs) and the second-largest maker of analog and mixed-signal chips. ''TI is a pure growth play, which is in a strong upward trend,'' argues Skeen. Just a year ago, TI was languishing at 43 a share. Since then, it has rocketed up, hitting 141 on Oct. 13. That was two weeks before the Dow's plunge. On Oct. 27, TI slumped 9 points, to 102. But by Oct. 29, it had rallied, rising to 1147/16. Skeen feels certain the stock is on its way to 180. ''TI is the Intel of the wireless world,'' says Skeen, referring to the company's hot DSPs, the ''brains'' in cellular phones. TI holds 50% of the business for cell-phone handsets, he adds. On the other hand, TI's memory chips--which have been hampered by soft prices--have been a drag on sales, on earnings, and on the stock price. But Jonathan Joseph, who tracks the industry at NationsBanc Montgomery, believes that chip prices are flattening out and that further sharp drops are unlikely. Increased demand as the market heads into its strong season is soaking up excess DRAM capacity, notes Joseph. He figures that a recovery in TI's DRAM business could add 30 cents to 50 cents a share in earnings. He thinks TI will earn $4.28 a share this year, $6.25 in 1998, and $8 in 1999. Among TI's strengths, Skeen adds, are its solid balance sheet and cash position. The company has salted away $3 billion since the end of the previous quarter, notes Skeen, part of which resulted from the sale of its defense business for $1.5 billion. Skeen figures the company will use the money for an acquisition or a share buyback. Either move, he adds, should boost earnings. BY GENE G. MARCIAL