Thursday, May 29, 2014

Seeking Alpha: GSI Technology Struggles Amidst A Fading Market

Around seven months ago, I wondered whether GSI Technology (GSIT) was an undervalued tech turnaround candidate or a value trap stuck in a fading market. The story isn't over yet, but the latter option seems like the more likely one at this point. Not only do companies appear to be replacing static RAM with DRAM, pseudo-static RAM technologies like 1T-SRAM, and other memory options, but Cypress Semiconductor (CY) would appear to be faring better in this fading market. A cash-rich balance sheet (the company's enterprise value is half of market cap at around $79 million) guards the downside risk, but it's hard for me to see how the company prospers outside of success in its antitrust litigation, and that will likely take years to resolve.

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GSI Technology Struggles Amidst A Fading Market

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