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Technology Stocks : Rambus (RMBS) - Eagle or Penguin -- Ignore unavailable to you. Want to Upgrade?

To: Michel Bera who wrote (3263)	3/11/1998
From: Tom Gebing	Respond to of 93625

To All - Intel unfolds road map for mobile PCs, see Rambus info. zdnet.com Intel will simplify development of high-end notebooks via Colfax, the code name for a motherboard platform that includes Pentium II processors, 440BX chip set, support for RDRAM (Rambus Dynamic RAM) 2x AGP (accelerated graphics port), the first 100MHz bus for portables and support for 1394, sources said. The 100MHz bus will come to portables more than a year after it is made available on desktops and servers, which is slated for this quarter. On April 15, Intel will introduce Pentium II processors with the 440BX chip set, which is part of what enables the 100MHz bus. Colfax will enable OEMs to deliver the new technologies without having to spend their own time and money on development. The platform will be available in the second half of 1999, sources said.

To: Michel Bera who wrote (3263)	3/11/1998 9:30:00 AM
From: REH	Read Replies (3) \| Respond to of 93625

Here's how I see the potential for Rambus - this is without the added market that DTV will give: In 1999 the semiconductor market will be about 80 billion, 10% market-share for Rambus would give Rambus a royalty of 120 million (based on 1.5% royalty). If we deduct 20% for G&A and R&D and 40% tax this should give Rambus an EPS of $ 2.16. Under this scenario stock price would be (relative to P/E): P/E 30: $ 65.00 P/E 40: $ 86.00 P/E 50: $ 108.00 Historical P/E's: Low: 333 High: 940 At a P/E of 130 (less than half the low to date) the stock price would be $ 281.00!!!! Let's say Rambus gets a 30% market-share in 2001 (and the semiconductor market in 2001 will be about 125 billion), then the numbers would look very impressive: EPS (same variables as first example): $ 10.80 P/E 30: $ 324.00 P/E 40: $ 432.00 P/E 50: $ 540.00 At a P/E of 130 the stock price would be 1,404.00!!!! This is not unrealistic, as a matter of fact the potential market share in this example is less than what the industry predicts. The P/E will most probably be closer to 130 than 30 based upon the potential future growth in royalty income. Now 10 times in 3 years seems very realistic!