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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: Jan A. Van Hummel who wrote (7514)	11/6/1997 6:55:00 PM
From: Parker Benchley	Read Replies (1) \| Respond to of 14577

Jan, At times like these it's hard for many of us to keep a clear perspective. Thanks for lucidly pointing out this comany (albeit in current trouble) is still highly attractive. Onward, George

To: Jan A. Van Hummel who wrote (7514)	11/6/1997 7:01:00 PM
From: Ski	Read Replies (1) \| Respond to of 14577

Jan, You make some good points. For example, if SIII gets down to $200M market cap any time soon, I will personally hop in my old pick up, drive to Toronto and plead the case that ATI buy the whole SIII ball of wax! I don't think that's gonna happen. Now, I know SIII is having a lousy time lately, but from my perspective at ATI, SIII keeps me so worried that I personally wet myself at least once a week in fear of their next product or market move. These guys still terrify me. When that goes away, then it's time to be scared. I'll be taking monetary donations for my Depends habit at Comdex... Ski

To: Jan A. Van Hummel who wrote (7514)	11/6/1997 9:17:00 PM
From: Glenn Norman	Read Replies (1) \| Respond to of 14577

Yo_Jan................................You had better get realistic in your out look. You wrote: " S3 would have to anticipate a loss of $2-3/share over the next 12 months to justify a share price of $4." For S3 to loss $2-3/share over the next year is VERY possible! Cheers-Norman

To: Jan A. Van Hummel who wrote (7514)	11/10/1997 12:50:00 PM
From: Bill Lin	Read Replies (1) \| Respond to of 14577

Jan, i'm just greedy with the $4 forecast. But i'll give you a scenario where it MIGHT come true: 1) Restatement of Q2/Q3 income produces a slight loss in each quarter ($0.05) 2) Sales of Trio64 and Virge plummet in Q4 as inventory overstock suspicions at distributors take hold. 3) Inventory levels at S3 are filled with about 30% old product (on $64mm guesstimate = $19.2mm) 4) They write off the old Trio 64 in anticipation of the TRio3D (DX chip performance?) 5) Q4 is basically an inventory sell through quarter. They spend some cash for GX/DX/MX/MXi and GX2 product. Also some money for Trio3D. but keep inventory levels LOW (i HOPE) 6) you CAN see $0.33 LOSS (from $19mm inventory writeoff) in Q4. 7) then you get more DOOM/GLOOM forecast on this thread and people panic out at $4. and if S3 misses its Nov. 14 filing period for Q3 10Q, it gets the "E" designation on its name (SIIIE), which will make investors REAL nervous. as for Cost to get into graphics market, nVidia, 3Dlabs, 3Dfx, ATI all have R&D budgets of $3 - $10mm/qtr. And there is plenty of Venture money in the Valley. but i agree with your idea about buying S3 by someone. The argument against is that doing so is throwing good money into a sinkhole (a la Apple, SGI), and the investor is betting it'll be a turnaround situation like NSM. S3 isn't a dead company, and there is lots to like about it (I WANT a GX2 board for the duo display capability). BUT i just bought a DX board 4mb in SF for $45. it was in OEM box. gotta make you wonder what they are selling DX chip for... bill