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Technology Stocks : CRUS, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Synapsid who wrote (4939)	1/29/1998 3:43:00 PM
From: ptrader	Respond to of 8193

From what I understand, Mass Storage revenues will be down this year because of the lost of business at one of their customers. Tom Kelly said this in the CC. Well how much could this be? If you listened to the CC, Hackworth said that without Mass Storage, the rest of CRUS would grow at industry averages and the overall company would be flat. If you say that the overall company is flat, then I would guess the following: without Mass Storage revenues at $113M last quarter(without non-core business), growing this at 13-16% would say that Mass Storage revenue would fall by about $80-$100M this year or by about 25%. This is a big number! Over the last year, you have seen that Mass Storage as the driving force behind CRUS growth. Now, the rest of CRUS is starting to grow. Too bad Mass Storage is now shrinking or it could have beeen off to the races for CRUS stock. Now the stock has limited upside or downside unless the company is willing to do something outside the box. You have seen lately CRUS pushing their IP in graphics. This has netted $60M to date. To answer you question, yes Mass Storage is designed into the 2.1 to 2.8 Gb/platter drives. How do I feel about Mass Storage? This year will be down, as far as renvenue goes. But I was encouraged by what Hackworth said about new products this year in the CC. He said that Mass Storage would sample single chip parts for both Magnetic and Optical DVD drives. What does this mean? It means integrating CPU/Controller/Read Channel into a single part. I do not know of anyone else that can do this. Why is this important? Cost, Cost, Cost. The drive companies are driven by cost, which should give Mass Storage a huge advantage going forward. He also said that there was a new read channel architecture coming out latter this year that would give CRUS a big advantage. I think that CRUS is big in mixed-signal technology and this should give them some advantage going forward. In general, I feel good about Mass Storage going forward, but hate it when they lose a design win of this magnitude. Everyone needs to make up his/her mind as to buy/sell/hold CRUS stock. I hope this info helps you.