Gilder Targets Touchpad Technology

11/15/2002 12:00 am EST

Focus:

George Gilder

Founder and President, Gilder Publishing, LLC

George Gilder has just released a revised version of his exceptional book, Telecosm. Subtitled, “The World After Bandwidth Abundance,” the book explains how fiber optics and wireless breakthroughs will lead to new technologies and corporate opportunities. Gilder’s unequalled knowledge of this field is also evident from his Gilder Technology Report. Here, he recommends a player in touchpad technology.

Synaptics (SYNA NASDAQ) is indeed a buy at the present price. The company commands a unique touchpad technology that already dominates the notebook PC market and will be increasingly useful on the new cell phone personal digital devices. It is widening its scope to biometric input devices for a variety of secure equipment. The stock trades at a trailing p/e of around 10. It has a cash reserve larger than its market cap. It possesses a 15% portion of Foveon, thus likely sharing in the  most important technological innovation of the next decade. It is breaking through in China with its Quickstroke Chinese character recognizer. What is not to like?”

“Third quarter sales were $22.5 million and GAAP earnings were $0.05 per share. Global demand for mobile PCs – laptops and notebooks – is set to outpace that of desktops, with South Korea and Japan leading the charge in Asia. This shift, coupled with Synaptics' dominance of the mobile PC interface market, should allow the company to continue to grow and to achieve its larger goals of product diversification. Profitability in the midst of a PC slump, combined with cash and short-term investments of $65 million, makes Synaptics an attractive play on a high-tech comeback.”

(Editor's note: Foveon has developed a technology that provides better color detail for digital cameras and video equipment. It allows image sensors to capture red, green and blue light at each and every pixel, while current technology records just one color per pixel.)

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