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Technology Stocks : LSI NEWS ONLY THREAD -- Ignore unavailable to you. Want to Upgrade?

To: Moonray who wrote (123)	4/1/1998 10:32:00 AM
From: jad	Read Replies (2) \| Respond to of 204

Good info and upgrade from Gruntal: Investor Suitability: Aggressive Growth We are upgrading our opinion of LSI Logic from a Hold rating to a Strong Buy for aggressive growth investors. Our 12-month price target is $35. We believe LSI is in the early stages of a recovery that could accelerate during the second half of 1998 and into 1999. LSI has experienced an improvement in orders, which started late in 1997 and continued in January and strengthened further in February. Additionally, we also have reasons to believe that March was a strong month for LSI. We believe if this momentum continues and is coupled by new business from new consumer applications, then the second half of 1998 could provide strong upside. LSI customers in the networking area have in our view completed its inventory adjustment, which started early in 1997 ahead of other end user markets. More importantly, we believe that LSI is gaining momentum for supplying ASICs for the networking market as many of the equipment suppliers have aggressively attacked their product expenses by eliminating costly designs through integrated ASIC products. Moreover, we are increasingly optimistic on the outlook for ASIC products for communications, as this market for products is exploding with the Internet and Intranet moving to ASICs from board solutions. Many of the traditional telecommunication markets are also evolving to add new features and cope with the exploding traffic. Consumer markets could be the dark horse for LSI for 1998 and 1999. This market accounted for 33% of revenue in 1997 up from 28% in 1996, thanks to Sony and the Playstation game console. We believe LSI will maintain this momentum for the Playstation. Furthermore, LSI has continued to aggressively invest in process technology and fabrication facilities. LSI is driving hard to ramp 0.25-micron during the second half of 1998 as well as 0.18-micron process due for volume in approximately 18 months. LSI is attractive in our view its stock is selling at a P/E of 22x our 1998 estimate of $1.15, which is almost in line with the market multiple. Our 1999 EPS estimate of $1.70, up from $1.65, suggests a 12- month price target of $35. ( Mona Eraiba ) Joe