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Strategies & Market Trends : Trader J's Inner Circle -- Ignore unavailable to you. Want to Upgrade?

To: Poet who wrote (9588)	2/22/1999 9:31:00 AM
From: unclewest	Read Replies (2) \| Respond to of 56535

RMBS more complete info on my early post Warburg Dillon Read February 22, 1999 Rating: Strong Buy Price: $ 71 1999E EPS: $ 0.33 2000E EPS: $ 1.19 12-18 month target: $ 150.00 * Industry leading performance with wide industry support: Rambus interface technology is a revolutionary approach to solve the growing memory bandwidth gap which delivers three times the performance of conventional SDRAM memory systems. Currently, Rambus technology is licensed to 8 of the top 10 of the worlds semiconductor companies - including the worlds top 15 DRAM manufacturers * Next standard for PC main memory: Intel selected the Rambus interface technology to become its next PC main memory standard and is expected to interface with Intel's processor line up top to bottom by calendar year 2001. The market for DRAMs in PCs is projected to be $ 25 billion in the year 2001 alone. Including other applications such as PC graphics and video games, we believe the total market potential for Rambus-based DRAMs is enormous. * Highly leveraged business model: Rambus licenses semiconductor companies to manufacture and sell memory and logic ICs incorporating its interface technology, and market its solution to systems companies to encourage them to design Rambus interface technology into their products. As a result, revenues consist entirely of contract revenue and royalties providing strong operating leverage with superior margins and upside potential. Summary: Recently Rambus stock traded down on concerns over the initial ramp in Direct RDRAMs during 1999. We believe that Intel remains fully committed to driving Rambus to become the next PC main memory standard - which we feel will be reiterated at next week's Intel Developer Forum. Although RDRAMs may be somewhat supply constrained during the second half of 1999, we feel that mass market adoption will occur in 2000, creating explosive earnings potential. In our opinion, this weakness has created an attractive opportunity to purchase the stock and participate in a truly unique story in the semiconductor universe. We initiate coverage on RMBS with a Strong Buy rating and $ 150 target price based on the enormous market opportunity we see for the company over the next two years. Greg Mischou/Seth Dickson