E-Mailbag Monday: Marvell, Rambus, Vertical Hubs

What looks good for the IPO market this week?

Reply: Finally, the IPO market is showing strength. Actually, there
was a moonshot IPO last week:
Acclerated Networks , which soared 219 percent on its
first day of trading.

There may be another moonshot for this week. The company is
Marvell Technology, which develops
integrated circuits for both data storage and broadband data transfers. The
company has customers like Seagate, Samsung, Hitachi, Fujitsu and Toshiba.
Moreover, Marvell signed a key agreement with Intel to supply it with
integrated circuits for networking products.

The financials are something to marvel at. In the past year, sales were
$81.4 million and profits were $13.1 million. In the past quarter, sales
reached $29.7 million and profits were $2.1 million.

The lead underwriter is Goldman Sachs and the price range is $12-$14. The
proposed ticker symbol is MRVL.

Rambus: The Fast Lane

What do you think of Rambus?

Reply: I definitely liked it much more several weeks ago. And, no
doubt, Rambus is a
top-notch company.

The power of the company was made clearer this week. Hitachi dropped its
patent infringement suit and is going to pay royalties to Rambus. Toshiba
is also going to pay royalties. Basically, Rambus has rights to key
technologies for semiconductors. With the recent legal settlements, it is
likely that other companies will follow. Thus, expect more and more
royalties for Rambus (perhaps from such biggies as Fujitsu and NEC).

But taking a flyer on the stock now is absolutely high-risk. Much of the
news has been disseminated. Rather, Rambus is probably a great daytrading
stock, left to those who have the stomach for huge swings in the stock
price.

Vertical Hubs: Focus, Focus, Focus

What is a vertical hub?

Reply: This is a business-to-business marketplace that caters to a
specific industry. After all, each industry has its own unique attributes,
so it makes sense to develop vertical hubs. Examples of vertical hubs
include INC2inc (food industry) and
e-Steel (focused, of course, on the steel
industry).

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