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  • Intel Blew Its Mobile Business; More Losses To Come [View article]
    des - 100% agree. You are preaching to the choir. You make the excellent....sorry EXCELLENT point, that essentially 80% of the available market is captive with Apple/Samsung. So, what is Intel playing for? They get 10-20% of the remainder in 2-3 years, and that's if they do well, so that's 2-4% of the market, and not the richer part of the market.
    Meanwhile, good enough in server could be quite good, and sizable volumes.
    Good discussion.
    Nov 2 09:11 AM | 2 Likes Like |Link to Comment
  • Intel Blew Its Mobile Business; More Losses To Come [View article]
    Dana, I absolutely agree. This is the subject of a future article. Looking out 5 to 10 years, there will likely be 3 companies that can afford to manufacture leading edge silicon, Intel, Samsung, and TSMC - as well as spend appropriately on process technology, r&d etc. Intel will never go away, because it will become an essential manufacturing partner. At some point it plays out and becomes a big time long.
    Nov 2 08:59 AM | 2 Likes Like |Link to Comment
  • Microchip: Value Beyond The Numbers [View article]
    Amit, have you read Steve Sanghi's book, "Driving Excellence" - it articulates his system, the "aggregate system" in 246 pages - also an excellent cure for insomnia. Sanghi happens to be a terrific CEO (and he thinks so too).
    Nov 1 08:37 PM | 1 Like Like |Link to Comment
  • ChipMOS Insiders Sell Despite 40% Free Cash Flow Yield - Lots More To The Story [View article]
    I think the average buyside analyst has a lot on his plate and when an idea like this hits, he doesn't spend a lot of time on it for several reasons:
    1. Until recently no EPS. While you and I might appreciate FCF and EBITDA, the average tech-oriented buysider looks at EPS when it comes to semis. This screens great for distressed/value guys, but a lot of them don't get the technology which they find too complex.
    2. Relatively illiquid. Stock obviously has traded decent volume the last few days, but it's been about 100k shares per day for much of this year. Say your a $500 million fund and you want to build a 1 or 2% position. How long will this take you, how much effort is it to do so without moving the stock in a significant manner?
    3. Stock is cheap, so it must be diseased. I have spoken to numerous people who have said, anything this cheap has to have a problem - yes it does, lousy communication with the street. It is not Chinese (of which there have been a number of frauds), it has world-class customers, it has relationships with real banks, etc.

    It simply isn't on a lot of radar screens. Cowen should be initiating soon. This is one of those unique opportunities. Once the good new is in, and the thesis plays out, this won't be sitting at $11.

    Finally, I'd be curious how often your semiconductor analyst look at cash flow/EBITDA metrics versus EPS.

    Best of luck and thank for the thoughtful discussion.

    Val
    Nov 1 12:32 PM | 2 Likes Like |Link to Comment
  • ChipMOS Insiders Sell Despite 40% Free Cash Flow Yield - Lots More To The Story [View article]
    Chipmos management is excessively conservative, unfortunately even to the detriment of shareholders. If you email CFO SK Chen and ask him directly if the reason for the share sale was because it is a required component to move forward with a listing in Taiwan, he will answer affirmatively. Since the shares being sold were by a third party, or in the case, two third parties, it appears Chipmos management could not find a way they were comfortable with to explain it in the filing.
    Nov 1 09:08 AM | 1 Like Like |Link to Comment
  • ChipMOS Insiders Sell Despite 40% Free Cash Flow Yield - Lots More To The Story [View article]
    Hi Robin - couple answers to your question.

    1. Having worked as an investment banker and worked with corporate attorneys, I am well aware of the language that is suggested for filings of this type. Companies are encouraged to be bordering on excessive in their risk factors so that, should anything ever go wrong, they are not sued. This is a fact.

    2. I have researched IMOS and its peers at length. In the LCD driver-IC space it is basically just ChipMOS and Chipbond, with Chipbond owning slightly larger shares. I don't want to suggest they cooperate, but I wouldn't be surprised if they attend one another's Christmas parties. Can you imagine, a duopoly in the fast growth LCD driver IC space. And in memory test it is for the most part just ChipMOS, Powertech International (PTI) and Walton, with a couple of smaller competitors. By comparison, in other segments of assembly/test there is Amkor, ASE, SPIL, STATS-ChipPAC, and dozens of mid and smaller players. ChipMOS is in a very uncrowded segment, but one that would require huge cap-ex for Amkor or ASE to enter if they wanted to - far cheaper and immediately accretive to buy ChipMOS at a huge premium.

    Finally, here is an excerpt from a 10-K that came out today:

    "Global markets for the Company’s products and services are highly competitive and subject to rapid technological change, and the Company may be unable to compete effectively in these markets.
    The Company’s products and services compete in highly competitive global markets characterized by aggressive price cutting and resulting downward pressure on gross margins, frequent introduction of new products, short product life cycles, evolving industry standards, continual improvement in product price/performance characteristics, rapid adoption of technological and product advancements by competitors, and price sensitivity on the part of consumers."

    Not sure if I'd touch that company with a 10 foot pole. And that's just a fragment from 1 risk factor - there's almost 10 pages of risk factors. By the way, the 10-K is Apple's.
    Oct 31 09:28 PM | 1 Like Like |Link to Comment
  • 4 Reasons To Buy Satcon Technology Corporation - Update [View article]
    I don't disagree with you at all - it is here to stay bc governments will continue to fund it.

    Why did Power One guide down 4Q? Because Italy and Germany are seeing a dramatic decline in demand. Why the fall in demand? Because governments are cutting feed-in tariffs. Without government subsidization, the industry does not work.

    You can install solar for $0.20 per kWh because of government subs, not because that is its market cost. I would invest in a solar installation company from a project finance perspective - you can lock in IRRs etc, but solar supplies are subject to government whims, and though most governments try to be green, many are poor.

    That said, I'm likely to go long PWER due to their buyback, cash-rich balance sheet, and likelihood of being the last man standing/strong competitor in the inverter space.

    I don't hate solar or think it's going away, just expressing a fact regarding its current and foreseeable economics barring a disruptive improvement in efficiency.
    Oct 27 08:37 PM | Likes Like |Link to Comment
  • 4 Reasons To Buy Satcon Technology Corporation - Update [View article]
    Jorge, were you using Monopoly money in your fantasy world. As I wrote on your first article, essential to review a company's balance sheet. Even Power-One who reported tonight and has a great balance sheet is risky given the significant uncertainty around solar (ie an industry whose economics fail to make sense without government subsidization).
    Good luck.
    Oct 25 10:17 PM | Likes Like |Link to Comment
  • Intel: Buy This Deeply Undervalued Chip Stock Now [View article]
    Intel has been pursuing mobile for over half a decade, and now they're going to win? ARM's strength is only increasing, and encroaching in server and notebook. Are you a generalist or have you actually followed Intel?
    To the point that tablets only served limited usage, you, like all PC bulls (or at least, not bears) are so myopic. What did the PC look like in year 2, 5 or 10. Year 10 I still owned an electronic typewriter. Your assumptions on tablets are based on tablets year 2. Let's see when tablets are really rocking.
    I am NOT short Intel, for reasons I may disclose in a future article, but your reasoning is lacking.
    Oct 25 08:16 PM | Likes Like |Link to Comment
  • Amazon Has Discontinued Using Neonode's Technology, Will Others Follow? [View article]
    I'd be very interested to hear what he has to say. Sounds like 3Q results are iffy and 4Q will miss by a mile. Kudos on a smart, balanced piece. Clearly some meaningful long-term potential positives. Will be interesting to see where stock trades if they guide 4Q lower.
    If they won't be issuing options regularly, perfect time to do it once.
    Take a look at Zynga option grants...awful. People must hate working there to need to get that much stock as an inducement.
    Oct 24 11:30 PM | Likes Like |Link to Comment
  • Mark Pincus Is The Next Steve Jobs [View article]
    Pretty amusing and Pincus is a dou%#e, but some good points. Why aren't you long?

    Whitehawk, how can you call it pump and dump when he doesn't even own shares?
    Oct 24 07:26 PM | Likes Like |Link to Comment
  • Vringo Vs. Google: A Mid-Trial Report [View article]
    Steve, any thoughts as to why Vringo has been trading steadily lower during the trial. Simply noise? Am considering taking a position given risk/reward, so curious if there's any nuance you're not mentioning. Have really enjoyed the updates.
    Oct 24 07:22 PM | Likes Like |Link to Comment
  • Why Apple Doesn't Care About Its Competition [View article]
    Felix, while I believe Apple has developed an ecosystem second to none, and has the marketing clout and customer loyalty to make any new product successful, I respectfully disagree with your conclusion - I think price matters.
    As a parent of young children, I was contemplating purchasing a mini - had it come in about $100-$150 cheaper. Now it's probable they get something from LeapFrog. I'm not unique - I know this is true with many parents.
    But it's not just that. I also proudly carry an iPad with me just about everywhere I go. I was thinking I would get a mini too - say I'm just reading a book and want a few apps. But again, at $329, that's a luxury. At $199, pretty close to a no-brainer.
    Is the mini additive to the Apple line-up? Sure. Is it nearly as compelling as at $199? No. And while it may be more profitable to sell fewer at $329 than more at $199 - fewer sales arguably grows the opportunity for the Android (and possibly MSFT) ecosystems. And boy do they need it. So perhaps Apple is making the short-term profit-play, and giving competitors a bigger long-term opportunity. Or perhaps, Apple truly has become an arrogant company that thinks price doesn't matter.

    In full disclosure - short Apple and long puts, based on our view of significant miss (worse than whispers) on iPhone 5 guide for December Q.
    Oct 24 05:36 PM | 3 Likes Like |Link to Comment
  • AMD - Near Term Revenue Outlook Is Terrible, Yet Investors Should Applaud Aggressive Restructuring Efforts [View article]
    They also have several hundred MILLION in payments due to Global Foundries in 2013, and will continue to generate losses on a cash basis. Before companies go away, they look kind of bad...then it gets worse. Yeah, this is going to get ugly.
    Oct 22 08:40 PM | Likes Like |Link to Comment
  • AMD - Near Term Revenue Outlook Is Terrible, Yet Investors Should Applaud Aggressive Restructuring Efforts [View article]
    At this point, AMD has had more facelifts than Joan Rivers. I can't believe they are not also cutting muscle with the fat. Ugly situation that will get uglier.
    Oct 21 01:49 PM | 3 Likes Like |Link to Comment
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