I lifted this from thestreet.com. This is their take on the RMBS presentation at last years Robby Stephens conference.
John
Robbie Stephens Semi Conference: What the Buzz Is All About
By Marcy Burstiner
Staff Reporters
7/30/98 3:30 PM ET
The hottest presentation thus far at the Robertson Stephens Semiconductor Conference (if only because the windowless basement room at the Ritz-Carlton Hotel was packed with over 250 fund managers) was the 9:30 a.m. Rambus (RMBS:Nasdaq) presentation.
Chief Executive Officer Geoffrey Tate and Chief Financial Officer Gary Harmon addressed a crowd that was well aware the stock had surged from 35 1/2 in mid-June to close at 52 1/2 yesterday.
The assembled money managers seemed to like what they heard. Toward the end of the presentation, cell phones were whipped out, people made for the exits and, within 10 minutes of the presentation's conclusion, the stock surged 6 to 60 1/8 per share.
The presentation from Tate was extremely bullish about the company's long-term prospects, and the news that Rambus' design would be used in every future Intel (INTC:Nasdaq) chip was particularly well received: "Intel, at the end of 1996, selected Rambus' design for future Intel chips sets. That's all Intel chips sets, including those from the lowest-cost desktop PCs."
Tate cited a study by a research firm called InStat that drew wows from the crowd. "InStat says that the percent of DRAMS that are using Rambus technology and design will exceed 50% by 2001," said Tate. "Our estimated market share right now is about 1%, so that represents significant gains in the near term for Rambus."
The company is a so-called "chipless" semiconductor manufacturer, meaning it designs proprietary Rambus DRAM chips that work up to three times faster than standard DRAM chips, but the company neither manufactures the chips nor subcontracts the work. That means it never gets stuck carrying inventory -- which is how most chip companies bleed to death.
"We're just delivering on the things that we told Wall Street we would deliver on," Tate said after the presentation. "But if I knew what Wall Street wanted, I wouldn't have to run Rambus for a living."
Tate also was the scheduled speaker for a 1 p.m. PST lunch -- just after the market closes. Rambus' shareholders are hoping he doesn't show up with a new presentation that starts with the word "Psyche!"
Cypress Still Hurting
If you go to a party, is it good form to talk loudly about the host's marital problems?
T.J. Rogers, chief executive of ailing Cypress Semiconductor (CY:NYSE), who likes to use a laser pointer in his presentations, put the beam on the conference host's confusing nuptial history. Rodgers' first slide welcomed investors to "the BancAmerica, Robertson Stephens, BankBoston, Etc., Etc., Etc. Conference." But that didn't seem to bother Robbie Stephens technology analyst Dan Niles, who congratulated Rodgers on "getting some value added" out of the slide show. Rodgers also got some yucks when he put up a picture of his new vice president of data communications, Ed Rodriguez, a former veep at National Semiconductor (NSM:NYSE), and offered: "This is not a Colombian drug lord."
But seriously, it's an open question whether Cypress can get its act together. The San Jose, Calif.-based chipmaker got slammed starting two years ago by the collapse in the market for static random access memory (SRAM) and more recently by the Asian turmoil (36% of its sales come from exports). Cypress has produced a 12-month negative return of 48% for shareholders. Like everybody else here, Rodgers promises an upturn is just around the corner. Cypress, facing an industry-wide SRAM overcapacity, is moving into more lucrative communications silicon and has an exclusive deal to supply mouse chips to Microsoft (MSFT:Nasdaq), he says, projecting that the firm's SRAM business will be profitable by the first quarter.
AMAT Gives and Gives and Gives and This Is the Thanks It Gets?
Oh, the frustrations of being a semiconductor equipment maker. You deliver the best technology to the chip makers, who sell their best chips to the box makers. But somehow none of it will work if the darn computer isn't plugged in! That's what Applied Materials (AMAT:Nasdaq) discovered at its presentation.
Just as Chairman and CEO James Morgan was about to explain the factors that would drive his industry's recovery this year, a large box appeared on the slide show -- you know the box -- "WARNING, YOUR COMPUTER BATTERY IS CRITICALLY LOW. ONLY 0% OF YOUR TOTAL BATTERY CAPACITY REMAINS."
Morgan kept talking. After he kept saying things like "As you can see," and "Clearly we have the ability to," it dawned on the packed crowd that he had no idea anything was wrong. Ten minutes later, Morgan paused and said, "Is there a square on the screen?" At that point, his techno experts began hovering in the back, the screen went blank and the slides, sans square, reappeared. And what timing. The slide now up was entitled "Enabling Customer Technology Transitions" and Morgan chimed, "We are trying to make chips smaller, smarter, faster and cheaper."
But where is the Energizer Bunny when you need him?
KLA Blinks
Still more technology snafus at the semiconductor conference. Next up after Applied Materials was KLA-Tencor (KLAC:Nasdaq), second only to Applied in sales of semiconductor equipment. Here, CFO Robert Boehlke launched into how KLA is "able to sell the latest and greatest state of the art technology to the fabs." But the overhead projection stayed on a notice that messages were waiting for fund managers Wendy Fitzsimmons and Jon Gruber (who cautioned TheStreet.com to lay off the "granddaddy of tech investors" nickname).
Boehlke was on top of this, however. "I was hoping my computer would work, but if I can get some help on advancing my slides," he said. "Any computer help here?" Help arrived 10 minutes later, but the slides this time sped fast and too far ahead. "I don't have a Ph.D. in computer stuff yet, so we will get there in a minute," Boehlke apologized, and added, "This is an IBM, by the way."
The slides slowed, much to his relief. But wait! Just as he got to some financials, he realized the slides were old numbers and asked the audience to disregard them. By now, more than a few people were checking their watches, opening their newspapers and wondering which company was up next. He finished up, saying, "A lot of good stuff here, as you can see."
Enough to cause a stampede of sellers. No way. Amanda Cox, of BankAmerica NT, said afterwards that she was excited by the company's presentation. While others were checking their watches, she noticed that KLA-Tencor was penetrating markets it had never been in before, stealing market share away from competitor Hitachi (HIT:NYSE), and that overall there was room for future growth.
Apodaca's Picks
Jerry Apodaca, managing partner of Apodaca Investment Group, spent lunchtime Wednesday with executives from Vitesse Semiconductor (VTSS:Nasdaq), whose stock he's held for about nine months. He first bought Vitesse at 5 in 1995, sold it about a year later, bought it back and watched it climb to 36. He likes Vitesse and other chip makers that are tied into the telecommunications industry. For that reason, he's also long PMC-Sierra (PMCS:Nasdaq), although he shorted part of his position about a month ago to play it safe. Overall, he's sour on semiconductors. Apodaca feels another downdraft coming and considers any investments in most of the companies at the conference dead money.
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