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Technology Stocks : C-Cube -- Ignore unavailable to you. Want to Upgrade?

To: BillyG who wrote (37438)	11/25/1998 3:56:00 PM
From: DiViT	Read Replies (1) \| Respond to of 50808

C-Cube Up 9% After CS First Boston Starts Co. At Buy NEW YORK (Dow Jones)--C-Cube Microsystems Inc.'s (CUBE) shares rose to a 52-week high Wednesday after Credit Suisse First Boston Corp. initiated coverage of the stock with a buy rating, the company said. C-Cube, of Milpitas, Calif., designs, makes and markets digital video compression chips and software for consumer electronics and computer manufacturers. C-Cube spokesman Nick Kormeluk said the initiation of coverage by CS First Boston helped give visibility to the stock and continued the momentum it has had over the last couple weeks. Kormeluk attributed the recent gains to continued progress with its DiviCom unit, recent design contracts, the pick-up of its digital video disc business, and the unveiling of DVxplore, the first single-chip consumer MPEG-2 and DV codec. DVxplore, which is expected to have wide-retail availability in 1999, allows PC users to edit and play DVD-quality video on standard PCs. First Boston analyst Charlie Glavin said the stock is going to benefit from the ramp-up of DVD and chao ji DCD, a Chinese video CD used for karaoke machines. He believes the murky issues that hurt standardization of the technology have been resolved. Glavin has set a $33 price target for the stock. C-Cube shares recently were up 2 1/2, or 10.6%, at 26 on Nasdaq volume of 2.1 million, compared with average daily volume of 506,100. Earlier, the shares reached 26 3/8, surpassing the previous 52-week high of 24 13/16 set April 24. Glavin expects C-Cube will grow, at minimum, in sync with the digital video market over the next three years. He noted that this year will be the first good Christmas season for DVD products. Kormeluk said C-Cube began to see the benefits of the proliferation of DVD consumer products in the third quarter, and expects DVD sales to increase in the fourth quarter. Glavin said the company's semiconductor business, which has 40% of the MPEG market, has stabilized and can leverage its hardware expertise to further support its DiviCom unit, which produces the complex systems that allow digital video networking. DiviCom provides C-Cube with half of its revenue. "It's not enough to just be an IC-designer," said Glavin. "You need to augment that with system-level expertise. C-Cube has literally set the standard in the compression/depression sector." -By Christina Cheddar; 201-938-5400