UPDATE - SILICON GRAPHICS

GOOD EARNINGS REPORT

Silicon Graphics (SGI)

Last night Silicon Graphics announced results for its second fiscal quarter, which ended December 27, 2002. The company's results exceeded expectations and showed the benefits of the restructuring efforts employed during the past six months.

For the December quarter, revenues were $263 million (higher than the expected $250 million) and showed a loss of $0.08 per share which also was better than the expected $0.11-$0.12 per share loss. Included in the December quarter results was a $0.03 per share charge for restructuring.

We are pleased with the results, particularly the rise in gross profit margins to 43% from 40%. Additionally, the company announced that there is a very strong interest in its newly announced Linux based products.

The December quarterly results further assured us that Silicon Graphics is an undervalued situation and we feel confident that the stock will reach our $3-$5 target price.

Stock Traders Press Management

 

 

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