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

To: Unwelcomeguest who wrote (55104)	6/6/2013 10:49:34 AM
From: joncon63	Read Replies (1) \| Respond to of 60323

I just put in a bid for some AAPL shares at $432 with some of the SNDK funds I took off the table. I seem to recall you made a similar move in the market meltdown but targeted shares in the $80 range?

To: Unwelcomeguest who wrote (55104)	6/6/2013 11:46:56 AM
From: Sam	1 Recommendation Recommended By JCnieuwenj Respond to of 60323

Perhaps this will lessen your anxiety somewhat. Summary of Sumit's presentation yesterday at the Merrill conference, from Merrill. They are bullish on Sandisk as well as Micron, although I think more so on Micron at these prices. Management guidance positive overall Sumit Sadana, executive vice president & chief strategy officer at SanDisk, presented at our 2013 Global Tech Conference in San Francisco on 5 June. The key takeaways: (1) Global NAND supply tightness due to the low impact from new tech (3D, 1ynm, etc), which requires a more complicated manufacturing process and consequently low yield (e.g., 3D cannot be a mainstream even in 2015 while 1ynm/1znm migration will likely slow in 2013-14); (2) NAND demand continues to be solid, led by SSD and embedded systems (smartphone, tablet) – even retail cards and USB drives continue to be profitable with a more favorable competitive landscape (fewer players); (3) Cost competitiveness with minimal execution risks (unlike Samsung, SanDisk's 3D comes after 1ynm/1znm nodes to minimize the start-up cost); 4) More effective benefit from yen weakness, particularly in 2H13, without FX-hedging burdens (in 2Q and early 3Q, FX was hedged at ¥86-95/US$ vs. currently at ¥99/US$) – Japan JV fabs are mostly denominated in yen; and (5) Strong balance sheet (net cash US$4bn) and record high FCF at low capex spending. FAQs: 3D, SSD, capex burden and dividend Management's answers to frequently-asked investor questions were very clear, which collectively implies the following upside catalysts: (1) 2D (1ymn, 1znm) is more cost competitive vs. 3D even in 2014-15; (2) OEMs' resistance to 3D is possible due to system instability (e.g., lack of efficient controller) and expensive initial prices; (3) higher growth in enterprise SSD vs. retail/client SSD targets; (4) heavier capex burden per wafer to deploy 1ynm vs. 19nm (lower bit growth using 1ynm) – slow migration from 19nm to 1ynm/1znm and minimal silicon wafer capacity expansion at Japanese JV fabs (captive capacity: 208k wpm) planned currently; (5) disciplined capex spending (the 2013 target is unchanged at the US$1bn range, which includes JV fabs); and 6) good execution of share buyback ($300mn YTD). Reiterate Buy; consensus too low, up-cycle possible We reiterate our Buy rating on SanDisk – one of our global top picks for the memory chip sector. Although SanDisk has outperformed SOX (YTD: 32% vs. 21%), its multiples still appear low based on our estimates for 2H or 2014 (P/E 8.1x, PBR 1.4x). The 2Q results will likely exceed consensus at higher NAND prices (OPM: 26% likely vs. 23%), in our view, and our 2014E EPS is about 50% higher than consensus, which seems to have not fully reflected yen weakness, the up-cycle of the ASP trend, and the cost structure even without 3D.