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  • Short Sellers Think These 6 Technology Stocks Are Ready To Rebound [View article]

    Clal Finance Ltd. today initiated coverage of EZchip Semiconductor Ltd. (Nasdaq: EZCH; TASE:EZCH) with a "Buy" recommendation and target price of $44, a 27% premium on Friday's closing price on Nasdaq of $34.64, giving a market cap of $970 million.
    Clal Finance Dov Rosenberg notes that EZchip develops and provides network processors (NPUs) for databases. Five of the world's top seven Ethernet equipment vendors use EZchip's products in their products.

    Rosenberg points to rising demand for high-speed bandwidth, and says that EZchip is one of the trendsetters. "EZchip is expected to growth in tandem with the telecom equipment market in the coming years. We believe that EZchip's wins with equipment vendors, such as ZTE Corporation (SZSE: 000063; HKSE: 0763), Cisco Systems Inc. (Nasdaq: CSCO), and Huawei Technologies Co. Ltd. will boost its share of the target market and increase its revenue 4-5 fold over the next few years, while maintaining a net profit margin of over 40%," he says.

    "It is important to note that EZchip's road map is not paved, and there may be more potholes on the way. Its position at the bottom of the Ethernet food chain results in low short-term visibility, which is liable to affect quarterly results, as happened during the past year," continues Rosenberg.

    "We believe that as far as NPU products are concerned, EZchip's competition will not come from other companies offering rival products, but from its customers, which may develop processors in-house, like Juniper Networks Inc. (Nasdaq: JNPR) did several years ago. But it is important to remember that, technologically, EZchip enjoys a high entry barrier, and development of an in-house processor requires three years planning and preparations. We believe that EZchip is 2-3 years ahead of the market in terms of technology."
    Dec 24, 2012. 08:24 AM | Likes Like |Link to Comment
  • EZchip (EZCH -2.1%) slumps after Value Bulldog makes a short case on Seeking Alpha Pro. The author questions EZchip's low R&D and sales spending, and notes the company has often let down analysts forecasting major sales growth. Concerns are also raised about the addressable market for high-speed network processors (NPUs), competition from Broadcom's (BRCM) BCM88030 NPU, and the fact Alcatel-Lucent and Juniper are relying on their own edge router NPUs (though market leader Cisco remains a big EZchip buyer). [View news story]
    http://seekingalpha.co...
    Dec 21, 2012. 12:57 PM | Likes Like |Link to Comment
  • There's Something Strange About EZchip [View article]
    From Domino Analytic Board. "This is moronic. He calls a 5x sales multiple "healthy" without explanation. EZchip's net margin is almost 50% which translates into a PE multiple that is 2x its revenue multiple. So how can a 5x sales multiple be healthy if it translates into a 10x PE multiple? So even using his stunted 2016 revenue model but a fair valuation multiple of 9x revenue (i.e. 18x earnings) would get a stock price in the $40s. So I could recast his analysis as follows: to not make money in EZCH over the next three years would require the merchant NPU market to remain static at its 2011 level, which in turn requires us to ignore the NP5; as well, the NPS opportunity would have to fail to materialize."
    Dec 20, 2012. 08:57 AM | 1 Like Like |Link to Comment
  • EZchip (EZCH -2.1%) slumps after Value Bulldog makes a short case on Seeking Alpha Pro. The author questions EZchip's low R&D and sales spending, and notes the company has often let down analysts forecasting major sales growth. Concerns are also raised about the addressable market for high-speed network processors (NPUs), competition from Broadcom's (BRCM) BCM88030 NPU, and the fact Alcatel-Lucent and Juniper are relying on their own edge router NPUs (though market leader Cisco remains a big EZchip buyer). [View news story]
    Huawei, Eric, Zte, Tlab ,Cisco all EZCH Tier 1 customers.
    JNPR and Alu old news. EZCH in, ASR 9000, ASR 5000 and ASR 1000 from Cisco. Cien ,Patel Alto customers among others. NPS new chip being developed for the cloud covers all 7 layers. Video and Data expected to rise three fold by 2016 as per Cisco. Linley expects huge increases in high speed by 2015. Np-4 rollout just beginning at most tier 1.
    Dec 18, 2012. 02:10 AM | Likes Like |Link to Comment
  • EZchip (EZCH -2.1%) slumps after Value Bulldog makes a short case on Seeking Alpha Pro. The author questions EZchip's low R&D and sales spending, and notes the company has often let down analysts forecasting major sales growth. Concerns are also raised about the addressable market for high-speed network processors (NPUs), competition from Broadcom's (BRCM) BCM88030 NPU, and the fact Alcatel-Lucent and Juniper are relying on their own edge router NPUs (though market leader Cisco remains a big EZchip buyer). [View news story]
    EZCH is high speed NPU, they know who the potential costumers are, so the amount spent on sales is negligible and not important. As for analysts, they beat last two of the last three quarters. Sales are lumpy and the stock price is based on the world needing high speed internet. Video and data are growing exponenially. Global Ip traffic will grow threefold over the next five years according to Cisco. EZCh is also used in the clound for servers. Do you really think CSCO, TLAB, ZTE, ERIC and Huawei and others are going to give up their invesments in software for BRCM and MRVL which are not even in the same markets today. I doubt it.
    Dec 18, 2012. 01:58 AM | Likes Like |Link to Comment
  • EZchip (EZCH -2.1%) slumps after Value Bulldog makes a short case on Seeking Alpha Pro. The author questions EZchip's low R&D and sales spending, and notes the company has often let down analysts forecasting major sales growth. Concerns are also raised about the addressable market for high-speed network processors (NPUs), competition from Broadcom's (BRCM) BCM88030 NPU, and the fact Alcatel-Lucent and Juniper are relying on their own edge router NPUs (though market leader Cisco remains a big EZchip buyer). [View news story]
    ZTE, Telllabs, Huawei, and Ericsson use EZCH. Brcm and Mrvl do not compete with Ezch. With software involved EZCH would be very hard to replace, so competition is not exactly as mentioned. The above represent 70% of the market in high speed NPU. The NPU-4 all is being used in servers and the cloud. Np-5 and NPS which covers all 7 layers are on their way. Np-5 is 200 and already on board at the above companies. Ciena and other companies use EZCH. Alot of misinformation in the above article. If growth occurs as per Linley, the stock price would not seem to be expensive. This is a short trying to cover. Also ASR 9000 ASR 1000 and ASR 5000 at CSCO have EZCH inside. I would cover short.
    Dec 18, 2012. 01:58 AM | Likes Like |Link to Comment
  • EZchip (EZCH -2.1%) slumps after Value Bulldog makes a short case on Seeking Alpha Pro. The author questions EZchip's low R&D and sales spending, and notes the company has often let down analysts forecasting major sales growth. Concerns are also raised about the addressable market for high-speed network processors (NPUs), competition from Broadcom's (BRCM) BCM88030 NPU, and the fact Alcatel-Lucent and Juniper are relying on their own edge router NPUs (though market leader Cisco remains a big EZchip buyer). [View news story]
    BRCM ch is has no traffic manger in it and is not at the edge but in transport. Furthermore, again does anyone think all that software investments by these companies is going to be just thrown out to change vendors. Also, the amout of ports on the chip are paramount. Np-5 with traffic manager soon to be released by EZCH, same speed 200 and with traffic manager.
    Dec 17, 2012. 06:20 PM | 1 Like Like |Link to Comment
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