September 5, 1999. RF Micro Devices manufactures proprietary radio frequency integrated circuits
(RFIC) for use in wireless communications. Their products include amplifiers, mixers, and modulators/demodulators
for use in devices such as cellular and cordless telephones, industrial radios, wireless security, and remote meter
reading.
The company also offers more than RFIC products. RF Micro Devices sells their products worldwide
both directly to customers and through a network of 18 domestic and 20 foreign sales representative firms. TRW
owns a 33% interest in the company.
RF Micro Devices helps you get on the right frequency with their standard and customized radio
frequency integrated circuits. RFMD has contracts with independent vendors to package and assemble their products,
which are then tested and shipped from their headquarters.
Customers include Nokia, Lucent and Samsung. The company's impressive line of wireless communication
products and astounding stock performance have made it a darling of Wall Street analysts. Over the past year their
stock price has increased 1000%, from $3.06 to Friday's close of $45 13/16.
I see it going to $90 by mid year 2001, by my estimation. It could even jump to over $110 by
year end 2001, if sales continue to grow at such a rapid pace of 150% a year. The normal industry's rate is 18%!
Morningstar gives it a A+ growth rate, while Financial health gives it a B+.
Due to the 200 + point gain of the Dow Friday, I would hold back from making a purchase at this
time on RFMD. It would be a good idea to try and buy it at a reasonable price of $39 a share in a matter of a few
weeks. If you are a long term investor, than a few points will not make a big difference, and this is where many
people make mistakes in purchasing a company which they think will return a nice profit down the road. After the
stock makes higher ground, the price is not doable for the investor. Then it gets too high for their pocketbook.
It has happened to me and it has happened to others as well. Ticker symbol: RFMD
Readers have asked if I give out buy, hold, sell signals. Yes, I do, but not on this column.
The reason is that the column is mainly for long term investors that should hold a stock for at least 2-5 years,
or longer.
George
