Thursday, July 3, 2008
The stock is takeover bait under $14. Expect to hear the recurring rumor that Intel is planning to acquire them. And Intel should be considering it down here... though I wonder if it would pass regulatory muster. Nvidia remains the market share leader in notebook graphics chips. It is likely that AMD will wrestle with liquidity problems over the next year -- this may put further pressure on pricing for the next several quarters. Intel will also be stepping up their low end graphics chips offerings, assuming they get them working correctly.
The chart is a mess. I don't see anything down here at all. And the story sounds horrible. Yet I think the franchise is undervalued at this level. We'll see.
Posted by Roy Howard at 7/03/2008 08:38:00 AM
Wednesday, July 2, 2008
So there was an inventory issue in graphics cards and I suggested shorting Nvidia into Goldman's upgrade.
The company just preannounced significantly lower sales than forecast -- consensus is close to 1.1 billion and they're saying 875-950 mil. They cite the delay of Intel's Montevina, a lousy worldwide economy and lower pricing assumptions to fend off competitive threats. I do think the worldwide economy is a great excuse but I think Nvidia was stuck on a growth trajectory it couldn't maintain. They were overproducing and it bit them in the ass.
They're also taking a massive $200 million dollar charge against products failing at unusual rates in the field due to what appear to be heat issues from the description of the problem.
Posted by Roy Howard at 7/02/2008 04:52:00 PM
Tuesday, July 1, 2008
What a pig.
I don't even know why its going down anymore.
An interesting opinion article from the chief strategy officer of EMC's Symmetrix division. He says Zeus drives rock.
STEC also took out a credit line with Wachovia. They're buying a mcmansion. I jest!
STEC intends to use the proceeds from the credit facility to fund its working capital requirements, including the increasing inventory and accounts receivables of its growing SSD business. The Company believes the new credit facility together with its existing cash-on-hand, which was approximately $74 million at the end of the first quarter of 2008, will provide adequate liquidity to support expected accelerated growth in future quarters.
Expected accelerated growth sounds good, no?
I would think lower NAND prices would be good for them -- it will drive adoption of SSD drives.
I also think I'm a goddamn moron paying $13. Ahh, hindsight. I love it when I can be right when I'm wrong.
Still long but not so strong.
Posted by Roy Howard at 7/01/2008 02:47:00 PM
Monday, June 30, 2008
Banks. Airlines. Autos. Brokers. All of these industries are grappling with structural issues that are unlikely to improve over the near-term and all are likely heading toward catastrophic failure if something doesn't change soon.
The government in the past has had to bail out the first three industries. Besides being vital symbols of America, the country probably won't run particularly well without airlines and banks. Autos, well... I'm not sure the country runs better with the american auto industry but it does employ an awful lot of people.
That bailout money is going to have to come from somewhere. Iraq would be the most logical choice -- at a cost of $500 billion and counting, our efforts to de-stabilize and then re-stabilize the region on a war of false-pretense seem morally unsound. But yet, the region seems to be destabilizing around us. The higher oil goes, the more brazen Iran becomes. Though we probably don't belong there in the first place, I'm not sure we can leave right now.
It's tough to paint a really positive picture for the economy, particularly for the dollar. I don't know what turns this situation. Lower oil prices would help but that's a bandaid. The wound to the financial system is much deeper than that. We need a massive reduction of risk and leverage. And that's just going to take time and pain. There's no quick fix for it.
I wouldn't want to be President next year. Talk about your disasters. Me. President. Oh, man. Look on the bright side... I guess it could be worse.
Posted by Roy Howard at 6/30/2008 10:15:00 AM
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