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No. of Recommendations: 7
I know this will make some QCOM diehards sick but I believe RMBS is now in the middle of a tornado that the shorts are currently winning (for the moment).
I base this belief on the huge known success of Rambus with playstation this quarter, and the near guarantee of a second consecutive blowout based on a 500% increase in production by Samsung NEC and others.
This is accomapnied by design wins an other pins knocked down LU, and Motorolla for example.

RMBS longs have clearly suffered much lately.
Can anyone relate to me what it felt like holding QCOM in April of last year?
Please look at April in the following chart.

Look similar to what is happening right now with RMBS?
http://finance.yahoo.com/q?s=qcom&d=b

I have never seen so much FUD, and outright blatant lies by some now posting on the RMBS board.
Were there similar experiences with QCOM last year?

This is the way I see it.
100 billion DRAM market by 2002.
Lets be conservative and cut it in half.
50 billion DRAM market.
Intel targets RDRAM at 65% market share.
Lets cut that to 50 to be conservative.
1.5-2.5% royalties.
Let's be conservative and say 1.5%
Let's be conservative and say DDRAM is not a violation of RDRAM patents.

Intel designed RDRAM support right into their chipsets. Unlikely they will change even if anything else way better came along IMO. This will also give the AMD monkey something to think about if DDR is the niche higher priced option. (Top o' the line Servers for DDR). I believe the gorilla has stated this very clearly.

Where does that leave us?
50 billion * 50% share = 25 billion market share.
1.5% royalties = 375 million in revenues.
23 million shares = EPS of $16.
Lets be conservative. EPS = $10.
Lets assume a PE of 50. Not very high for a tornadic gorilla I think.

Result $500/share based on 2002 earnings.
I believe I was conservative all the way.
Is my math correct?
Play with the numbers a little and tell me where you think is is headed.

Disclosure:Very long and currently very suffering. Would have preferred a quiter and steadier start.
Any idea where this is headed?

Thoughts please.



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