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Technology Stocks : Texas Instruments - Good buy now or should we wait? -- Ignore unavailable to you. Want to Upgrade?

To: TREND1 who wrote (3282)	3/19/1998 7:02:00 AM
From: johnny boy	Read Replies (1) \| Respond to of 6180

Larry, Of course, TI will spend money on the 64K node. As I have heard, I believe, 64M EDO should be last EDO offering but Synchronous 64M will overwhelmingly be the mainstay. Who knows how quickly things may change, but I believe the above to be true. JB

To: TREND1 who wrote (3282)	3/19/1998 9:06:00 AM
From: rob	Read Replies (3) \| Respond to of 6180

TI has 64MB SDRAM and DRAM devices. It has just finished migrating the 0.28um proccess to its FABs. With this it cam make either 16Mb shrinks or 64Mb SDRAM or DRAM in either. They are working on a further shrink for the 64Mb SDRAM using 0.24um 256Mb technology. So you see R&D wise they are still in the DRAM business. That's the good news... I think? The bad news... All of 1997 they have been running 0.4um 16Mb in there fabs and this size die only produces 440 die per wafer. And at an average 1800 wafer cost, roughly $4 per chip, somebody is loosing money. And it has been mainly the JV FABs since TI's wafer cost is tied to ASP. But even then TI has been loosing money since the 4Q since ASP have been below $4 and test/pacakaging plus SGA R&D adds about $1.50 - $2.00 per device at TI. There 64Mb DRAM is in production... though 64Mb DRAM demand is limited to file server systems... not consumer PC. TI's 64Mb SDRAM is not yet out in the current 0.28 form. They will be lagging the market on that one. They do have a damn good 16Mb PC100 part which could be good if they could command a premium for the PC100... unfourtently they are lagging on the 64Mb PC100 part Also the current 0.28um shrink in 16Mb produces 600 die per wafer while people like MU are getting 850 die on there 0.25um runs. Plus MU's proccess is "much cheaper" since it uses 16 mask steps vs about 25 for TI. The short is if MU is loosing money in DRAM's you can bet TI and its JV's are loosing there shirts. Fourtunatly in the short run the JV's absorb the bulk of the lost. But how long can that continue... obviously ACER had enough. What about KTI what's its breaking point. And the new TwinStar fab... now that it is "wholly" owned be TI, does TI "book" all the losess in DRAM's out of that??? I don't know. I have a feeling TI's 1Q98 $0.45 EPS estimate is at risk. Look DSP sales have even been slacking. Look at ROCKWELL's latest warning. The V.90 (the new 56K standard) has put a "glitch" in modem chipset sales last quarter, they warned yesterday. Well guess who provides the chips for 3COM/USR's X2 modems... TI!!! Add to that TI is a big player in the wireless handset chipset market, which is hurting the most from ASIA, especially canceled orders Korea. Combine that with insane pricing in the DRAM market. TI is loosing like $1.50 per 16Mb at $2.70, the current 16Mb ASP MU quoted in there conference call this week. Plus the transitions cost to the 0.28um node. Bottom line... I have bad feeling about TI EPS... I thinking high twenties... ie $0.29 - $0.25 for this quarter. For the year I hope they can produce the roughly $2.40 the market expects due lower DRAM market penatration, 64Mb sales and a way improved DSP So buy when TI gets back in to the mid-40's and sell between now and mid-April when it goes into the $55-$60 range. RP