Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Anadigics(ANAD) - Is anyone following this Company? -- Ignore unavailable to you. Want to Upgrade?

To: Sonny who wrote (440)	7/9/1998 8:49:00 AM
From: Wolverine	Respond to of 1079

From 7/9 SmartMoney Interactive Daily Screen: "...There's Anadigics (ANAD). This is not a comeback story -- yet. Anadigics, which makes gallium arsenide (GaAs) semiconductors that go into telecommunications gear, competes with SmartMoney pick Vitesse Semiconductor (VTSS), which has been rocketing along, beating estimates for the past two years and looking to turn in 63 cents in earnings this year. Anadigics, on the other hand, is expected to report a penny profit on the 16th of this month, after losing 2 cents in the March quarter, the first quarter of its fiscal year. That quarterly loss was the first loss in quite some time for the company, and quite a comedown from the 23 cent profit in the same quarter of 1997. The company points to Asia/Pacific troubles, but it seems that internal operating difficulties are mostly to blame. Sales plunged in the March quarter, from about $27 million to $18 million, after several years of steady growth. The company's primary line of business consists of chips for power amplifiers that go into cell phones, although Anadigics has been attempting to broaden out into base station equipment for cellular networks. ANAD also produces analog transceiver chips that go into red-hot communications products, such as cable modems and fiber-optic gear, though that part of the business is still small. Hans Mosesmann, senior research analyst with Prudential Securities, says that Anadigics failed to transition to new, lower-powered amplifiers operating in the 3 volt range. That led to a slicing in half of sales, and pushed out the company's plans to open a new chip fabrication plant, which in turn led to layoffs that cost the company 5 cents in the quarter on top of the 2 cent shortfall. There's a chance ANAD may yet miss the expected 1 cent profit, instead turning in perhaps a penny loss. But the numbers don't really matter, says Mosesman. Anadigics has to prove it can turn around the amplifier business by ramping up production of the right parts, and that's going to take at least a few more quarters, he says. Potential upside exists in the cable modem business unit. Tim Kellis with Adams, Harkness says that management has indicated sales may be improving this quarter and next, based on lift from the AT&T/TCI merger. Slim hope, but if it means the cable business grows steadily from its $4.6 million in sales last quarter, Kellis says, Anadigics will be that much better positioned for growth in 1999. We'll wait on this one to see signs of turnaround in the product line. If the reporting here doesn't make you want to rush out to buy the stock of any of these companies, that's partially the point. As the market relentlessly reminds us, earnings are important, but projected earnings aren't everything. -- By Tiernan Ray"