Post by Admin on Aug 29, 2015 10:47:22 GMT -5
Thanks to christopher for finding the average price per share for Mr. Zepf.
The $5.65 number is interesting. If we use Benjamin Graham's number for estimating the discount to intrinsic value (Graham believed in getting assets for no more than $0.40 for every dollar of intrinsic value -- or purchasing assets that had a "margin of safety"). If we assume that Zepf (sp?) is doing the same thing, then he may see an intrinsic value of $14, or more.
Billy Martin did the same thing with VTSS. He bought the majority of his shares for under $2, which was also at $0.40 per dollar of intrinsic value. They eventually sold for $5.28, netting him a little more than Benjamin Graham's margin of safety. I believe the trigger event(s) for the sale of VTSS was the two quarters in a row of "softness in China" simply because time is money.
I also believe that as in the case of VTSS, we will likely see a quick sale if AMCC starts to diverge from their projected numbers with earnings misses. I think that if AMCC continues to meet or beat earnings, that AMCC will continue to stand on its own. I don't think this is do-able long-term though given the size of INTC's war chest and all the many Chinese ARM processor up-starts.
I give it no more than two years before a sale, although I've been wrong before.
AMCC would certainly make for a nice turn-key entry for servers in the storage space.
The $5.65 number is interesting. If we use Benjamin Graham's number for estimating the discount to intrinsic value (Graham believed in getting assets for no more than $0.40 for every dollar of intrinsic value -- or purchasing assets that had a "margin of safety"). If we assume that Zepf (sp?) is doing the same thing, then he may see an intrinsic value of $14, or more.
Billy Martin did the same thing with VTSS. He bought the majority of his shares for under $2, which was also at $0.40 per dollar of intrinsic value. They eventually sold for $5.28, netting him a little more than Benjamin Graham's margin of safety. I believe the trigger event(s) for the sale of VTSS was the two quarters in a row of "softness in China" simply because time is money.
I also believe that as in the case of VTSS, we will likely see a quick sale if AMCC starts to diverge from their projected numbers with earnings misses. I think that if AMCC continues to meet or beat earnings, that AMCC will continue to stand on its own. I don't think this is do-able long-term though given the size of INTC's war chest and all the many Chinese ARM processor up-starts.
I give it no more than two years before a sale, although I've been wrong before.
AMCC would certainly make for a nice turn-key entry for servers in the storage space.