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TI buys National Semiconductor for $6.5B

computerworld.com

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Re: TI buys National Semiconductor for $6.5B

#11

Post by philthy »

ihodes wrote: post #3

Very cool news. However, I see something like this and I wonder: "wow, Facebook is valued at over 10 times this purchase price (which is already inflated by virtue of it being a purchasing price)." I don't know what to draw from that; intuitively I see less value in Facebook, but I certainly haven't done an in-depth analysis.

I would say that it is definitely a power or over buy. I would agree that the purchasing price could be a good bit lower. Now I'm not trying to demean Nat in anyway they are in no way a garage operation, but they have not been doing that well in the past few years. I don't know if it is a downturn in markets or competition but their stock price isn't where it was 5 years ago.

http://www.google.com/finance?q=National+Semiconductor&o...

But it sure as hell will be tomorrow look at that after hours!

Re: TI buys National Semiconductor for $6.5B

#12

Post by JaymeHoffman »

hugh3 wrote: post #7
JaymeHoffman wrote: post #5

This is awesome for TI! It is pretty crazy that Facebook is valued over 10 times this but if we didn't have facebook we wouldn't have likes, pokes or farmville...... If we didn't have Semiconductors we might not have Facebook. Strange world indeed! "Like" it though.

If we didn't have Semiconductors we might not have Facebook. And if we didn't have sand we wouldn't have semiconductors, but I still ain't buying up the Gobi Desert.

YES!

Re: TI buys National Semiconductor for $6.5B

#14

Post by sliverstorm »

tomkinstinch wrote: post #9

Why aren't there greater anti-trust concerns over this?

I can't speak for everyone, but while I'm a little saddened by this, I'm too busy being optimistic about the future to get worried about anti-trust. NatSemi makes good chips, but everything else seemed a little shaky (have you seen some of their newer datasheets...?) and I hope being owned by TI will help a lot of these things.

Re: TI buys National Semiconductor for $6.5B

#15

Post by mlinsey »

spitfire wrote: post #6
ihodes wrote: post #3

Very cool news. However, I see something like this and I wonder: "wow, Facebook is valued at over 10 times this purchase price (which is already inflated by virtue of it being a purchasing price)." I don't know what to draw from that; intuitively I see less value in Facebook, but I certainly haven't done an in-depth analysis.

Nat semi has a known value and track record. Facebook doesn't have a known value/track record. Same with all these doctoms that give away things for free. The second they start charging they put a cap on their value. With facebook you're paying for future potential. That's the reasoning, whether you agree with it or not.

Your post seems to be implying that Facebook hasn't found a business model, and that a day of reckoning will come "the second they start charging". However, Facebook is already charging for advertisements, that's how they earned about $355 million in profits in the first 3/4 of 2010: http://nymag.com/daily/intel/2011/01/goldmans_leaked_details...

In contrast, National Semiconductor earned about $220 million in profits for approximately the same period: http://www.google.com/finance?client=ob&q=NYSE:NSM (not exactly the same months, because their Q1 goes from Dec-Feb, but still a useful point of comparison)

One can make the case that Facebook is overvalued, perhaps even grossly overvalued, but to say that it should be valued at less than National Semiconductor is a big stretch, even if you are very conservative and use only current bottom-line financials. In my experience, those who make such statements are not basing their opinion on fundamentals of the companies, but on an opinion that companies like National Semiconductor do "real" engineering as opposed to "frivolous" social networking sites like Facebook. It's discouraging to see such attitudes, but they are not new: both early internet companies (including ones that survived the bubble and turned out to be sound companies) as well as early PC-era companies were also derided as toys or fads.

Re: TI buys National Semiconductor for $6.5B

#17

Post by chrisjsmith »

sliverstorm wrote: post #14
tomkinstinch wrote: post #9

Why aren't there greater anti-trust concerns over this?

I can't speak for everyone, but while I'm a little saddened by this, I'm too busy being optimistic about the future to get worried about anti-trust. NatSemi makes good chips, but everything else seemed a little shaky (have you seen some of their newer datasheets...?) and I hope being owned by TI will help a lot of these things.

Agreed on that part. Also MultiSim is damn expensive. TI are usually cheaper on tooling and software support.

Re: TI buys National Semiconductor for $6.5B

#18

Post by chrisjsmith »

I see a lot of people saying "ooh facebook is valued 10x" that but you have to look at history. Facebook does NOTHING for ANYONE really other than a) support a number of people piggy-backing on it to make some cash b) keeps VC's occupied and salivating over their new Ferrari's and whores and c) violates everyone's right to privacy to the highest bidder.

NI/TI produce REAL, IMPORTANT devices and platforms which a large quantity of the world runs on that keeps you dry, transported, fed, sheltered and entertained.

Re: TI buys National Semiconductor for $6.5B

#19

Post by alain94040 »

mlinsey wrote: post #15
spitfire wrote: post #6

Earlier quoted context omitted.

Nat semi has a known value and track record. Facebook doesn't have a known value/track record. Same with all these doctoms that give away things for free. The second they start charging they put a cap on their value. With facebook you're paying for future potential. That's the reasoning, whether you agree with it or not.

Your post seems to be implying that Facebook hasn't found a business model, and that a day of reckoning will come "the second they start charging". However, Facebook is already charging for advertisements, that's how they earned about $355 million in profits in the first 3/4 of 2010: http://nymag.com/daily/intel/2011/01/goldmans_leaked_details... In contrast, National Semiconductor earned about $220 million in profit…

Exactly. I have no doubt that Facebook's profits could easily triple in the next two years. For National Semi, I wouldn't bet on it :-)

So yes, a somewhat larger valuation for Facebook than National sounds reasonable. So, $6B -> $15B, $20B.

Re: TI buys National Semiconductor for $6.5B

#20

Post by reemrevnivek »

ck2 wrote: post #16

Is this good or bad for the future of ARM cpu/chipsets?

It's irrelevant: National doesn't make many microcontrollers, much less CPUs. They've got a few small, overpriced 8- and 16-bitters (think garage door opener, not smartphone) running proprietary cores, but those are not very popular. (And they've reassured us that they won't discontinue this stuff anytime soon, though I think that it's high time to start looking elsewhere if you depend on National's microcontrollers...)

This does have an impact, though, on the support components which are necessary to build a motherboard - voltage regulators, sensors, diodes, transistors, glue logic, level translators, etc. National and TI used to be competitors in that arena, now they're on the same team.

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