The GPS chips will be provided by Global Locate which was recently acquired by Broadcom (Nasdaq: BRCM).  The GPS chip made by Global Locate is an ‘Assisted’ GPS or A-GPS chip that uses a combination of satellite and cellular signals.  This results in a better performance indoors and places where there is no direct view to the satellite.  Assisted GPS chips are ideal for mobile phones.  Nokia (NYSE: NOK) is already on board with Assisted GPS technology. 

Here’s a little explanation of A-GPS via ExtremeTech:

It can take 30 seconds to do a “cold start” and figure out where you are—because the low-power satellites transmit data at just a few bits per second. So SiRF has also developed assisted GPS (A-GPS), primarily for cell phones. With an assisted GPS-enabled cell phone, two things happen when you request a fix. First, SiRF’s GPS hardware fires up and starts hunting down satellites. At the same time, the phone makes a quick connection to a special server run by your cell provider, which quickly delivers rudimentary location information—”You’re in New York, not LA.” Combine those together and an A-GPS-enabled phone can get a fix in under a second.

As you can see Global Locate is not the only outfit with this technology, but either way, an iPhone win is pretty significant.  Even if this rumor turns out to be true, I don’t see how this is all that bad for SiRF except on the PR side.  Right now, GPS based phones are at a very early stage.  The awesome Apple marketing machine will only help the overall mobile GPS market and will help it grow at a faster rate.  If iPhone has built in GPS so will it competitors and SiRF will have it’s fair share of wins along with Global Locate (Broadcom). 

SiRF is already providing Motorola, is being used by Research in Motion’s (Nasdaq: RIMM) Blackberry 8800, and there is possibility of gaining Sony Ericcson as client.  Apparently, Sony Ericcson stopped using Global Locate/Broadcom.

There is no question the competition has increased several folds for SiRF but there is a huge opportunity out there in the mobile GPS market. 

Last week, both Deutsche Bank and Oppenheimer came out with positive comments and a ‘Buy’ rating with respective price targets of $30 and $28.  With SiRF still near its lows it’s sitting nicely in that low-risk/high-reward category. 

* I am long SiRF

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http://notablecalls.blogspot.com/2007/09/sirf-tech-nasdaqsirf-inflection-point.html

Couldn’t agree more with this article.  I didn’t expect SiRF to go this low and was a little early on my call to buy SiRF back in early August.  I don’t see much downside at this point. 

* I am long SIRF

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Here are the highlights:

• Net Revenues for the 2Q were 70.6 million – Increase of 23.4% YoY.
• Gross Margins declined to 54.6% from 56.3% a year ago.
• Net Income came in at $2.1 million or $0.04 per diluted share compared to $1.7 million or $0.03 per diluted share a year ago. 
• The company has $211 million in total cash.
• The company lowered its full year 2007 revenue guidance to $300 – 310 million from $320 – 330 million. 

Other key highlights:

• Revenue in wireless growth slower than expected.
• SiRF, Intel (Nasdaq: INTC) to jointly develop and market products for Mobile Devices.

Analyst Opinions (post 2Q earnings):

• RBC Capital Markets:  ‘Outperform’ but target price reduced to $26 from $30
• Montgomery & Co:  ‘Outperform’ but target price reduced to $25 from $32

The wireless shortfall was blamed on Motorola (NYSE: MOT) which has really been struggling of late.  It recently even gave away its number two wireless handset spot to Samsung. 

SiRF is still in a great position and is a leader in its field.  We are still further away from the wireless/handset GPS promise but not too far away.  Wouldn’t it be nice to have built in GPS in the next version of the iPhone?  Although, there will be more competition in this sector for SiRF as compared to the PND sector the opportunity is much bigger as well.  Although, its hard to call a bottom it wouldn’t be too bad to start a small position here.  SiRF could also be an acquisition target now that its privately held competitor, Global Locate, has been acquired by Broadcom (Nasdaq: BRCM). 

I recently got back into SiRF (pre-earnings) by buying JAN 08 calls and bought AUG 07 PUTS right before earnings to proctect myself.  I am glad I bought the PUTS and I think I should be fine by the time JAN 08 rolls around.  I previously got out SiRF back in December 2006 and said that I still like the GPS sector and am looking into Navteq (NYSE: NVT).  As it turns out I kept looking at Navteq but never bought it.  At that time Navteq was trading in the mid 30’s and now as we all know its near the mid 60’s.  Yes, of course, I am looking back at Navteq again for a good entry point. 

* Full Disclosure:  I own long-term CALLS and short-term PUTS in SIRF.

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Here’s my list (in no particular order):

• SiRF Technologies (Nasdaq: SIRF): The 5-day chart on this GPS Chipmaker looks pretty ugly. SiRF proved the naysayers (like me) wrong the last earnings release. SiRF’s monopoly in GPS chips is dwindling but the overall market is growing.
• Infosys Technologies (Nasdaq: INFY): I don’t think Infosys needs any introduction. Another stock that has taken a big hit this week.

Click here to go to the original article

* Full Disclosure: I am long STP, FTEK, UA, AMSC. I don’t have positions in BA, HDB, IBN, INFY or SIRF.

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This is a follow-up to my earlier article on SiRF titled ‘SiRF gets beaten up’. 

I am completely out of SiRF (Nasdaq: SIRF) as of today.  I sold half my shares on Friday and sold the rest this morning while the stock was still positive but starting its downtrend. 

Why did I get out:

• I didn’t like the price action the last couple of days as we saw no major rebound.  I wanted to get out while I was still up and ended up with a small profit.  Plus, I am little bearish as far as the overall market is concerned. 
• I still think SiRF is a good company with a bright future but there is no point falling in love with a stock.  I am going to closely monitor the stock and maybe get back in the near future when I feel like it has been overly punished.
• The cell phone GPS market is going to be huge but there is more competition in that arena then in the Personal Navigation Device (PND) arena.  Check out this new GPS chip from Epson.  This new chip is supposed to be the world’s smallest.  I had no idea Epson made GPS chips to begin with let alone the world’s smallest. 
• There was also Barron’s mention about SiRF’s high multiple. 

I still like the GPS sector and am looking into Navteq (NYSE: NVT). 

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