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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: Plaything who wrote (1223)	1/6/1998 12:14:00 PM
From: Tae Spam Kim	Read Replies (2) \| Respond to of 16960

Welcome to the party Motley Fool. :) Here is a reprint of the buy recommendation for my free stock letter's model portfolio back in August '97, some 9 points ago. -Tae J. Kim TDFX - 3DFX INTERACTIVE INC Date: August 25th, 1997 Exchange: NASDAQ Price: 15 1/4 30-Day Avg. Volume: 337,000 Shares Outstanding: 12,086,000 52-Week High: 18.62 52-Week Low: 8.87 P/E Ratio: Not Material EPS: 0.00 Click here for recent 10-Qs and IPO Prospectus. 3DFX Interactive Inc. makes high performance 3D graphics chipsets primarily used for the PC gaming market. Video card manufacturers such as Diamond and Hercules use 3DFX technology for their 3D add-in video cards. Currently 3DFX sells two chipsets, Voodoo and VooDoo Rush. Voodoo is a 3D only add in card for computer owners who already have a 2D card in their computer. VooDoo Rush is a 2D/3D card for users who want a one card graphics card solution. Reasons why 3DFX is a compelling investment: 1. Top Quality Management. The founder of 3DFX is 53 year old Gordon Campbell, who is renowned as an innovative entrepreneur and manager - check out the Silicon Valley issue of Business Week. This is his THIRD startup company, his previous successful startups include Chips and Technologies (just bought by Intel for over $400 million) and Seeq Technology. 2. Huge Market Share potential. Currently 3dfx has a 8% market share of the PC 3D graphics card market. However in a recent survey by Next Generation Online, 56% of computer game players in the survey said they intend to buy a 3dfx card in the near future. No other card came close, with PowerVR coming in at 10%. 3. Unmatched Software/Hardware Developer support. 3DFX is currently the #1 platform for upcoming computer games. At a recent E3 Expo, Computer Gaming World and PC Gamer called 3DFX the "star of the show." Over 90% of the upcoming computer games shown on the floor were on 3DFX cards. John Carmack from ID Software (makers of Doom and Quake) have been quoted as say the 3DFX cards are the best 3D graphics cards on the market. "With extraordinary performance, easy installation, and overwhelming game support, 3Dfx's Voodoo Graphics has become the standard platform for gaming on the PC,"- CEO of Canopus Corporation. As of today there are 8 video card hardware manufacturers that produce cards using 3DFX chipsets. Hewlett Packard, Micron, and NEC use 3DFX cards in some of their home computer lines. 4. Even Wall St. Agrees! All three analysts covering 3DFX now give it a buy recommendation. Recently on August 22nd, 1997 UBS Securities upgraded 3DFX to a Buy. "Demand for Voodoo graphics chipset has strengthened because of stronger than anticipated retail demand - add in card vendors are gearing up for a robust 4th quarter." 1997 Earning estimates are $0.22. 1998 Earnings Estimate were revised upward to $0.35. 5. Alliance with Electronic Arts. EA has a large equity investment in 3DFX Interactive. This alliance assures 3DFX of a solid library of games support and advice form the world's largest and premier software developer. I believe the main competition comes from recently released second generation chipsets such as Rendition's Verite V2200 and NEC's PowerVR2 . Both cards perform comparably to Voodoo at lower prices. However this Christmas (4th quarter) is will be OWNED by 3DFX because many of games will come out in 3DFX ONLY versions. Although Direct3D will help, support of these new competitor's cards simply won't be a factor until 1998. To combat this, 3DFX has been developing Voodoo2 and Banshee chipsets for the 2Q98 that promise to up performance by 2-4 times. I truly believe 3DFX is going to grow at a 40-50% clip the next couple of years, with the stock price reaching $30 in 12 months. It is in the enviable position of having the most market and developer support by far in the industry. And the great thing about the situation is that is JUST beginning. The company will reap huge benefits this 4th quarter because almost ALL of the top computer games will support 3DFX cards for best performance. And as games such a Red Baron II, Quake 2, Turok, Longbow 2, and Unreal are released, power hungry computer gamers will flock to buy Voodoo cards. My free stock website is found at members.aol.com