Silicon Arts, Inc.

Silicon Arts Inc. Analysis of Dig-image and W-Comm projects

Silicon Arts Inc. (SAI) is a manufacture of digital imaging Integrated Circuits (IC) that are used in digital cameras, DVD players, computers, medical and scientific instrumentation. The major sales are in North America but the company has presence in Europe and South East Asia. SAI grew rapidly in the first years due to the semiconductor industry boom. As the industry began to slow down, SAI watched their revenues fall by 40%. SAI survived the decrease in revenues by cutting costs and freezing capital expenses. Wisely, SAI continued its research and development efforts and developed the IC 1032 – a specialized chip used in data embedded mobile phones (University of Phoenix, 2007).

Hal Eichner, SAI Chairman, has a two point agenda for the company; increase market share, and keep pace with......

Silicon Arts Inc. (SAI) is a manufacturer of circuits that are used in a number of different electronic equipment (University of Phoenix, Simulation, 2006). In their first years, they saw first a huge soar in the industry, but that was swiftly followed by a 40% downfall in subsequent years. SAI dealt with this by tightly controlling their expenses. Current markets trends indicate that the industry may be on the rise. Consequently, and with the help of their new CFO, the company now wants to develop some new capital investment projects. SAI’s current goals are to increase their market share and to keep pace with new technology (University of Phoenix Simulation, 2006).

Part 1

The first task on the agenda was to examine the probable future scenarios that could potentially accept the cash flows for SAI and their two potential projects, Dig-Image and W-Comm. Included in SAI’s plans are the need to make $54 million in their first year by selling at least 400,000......

Risk Analysis: Silicon Arts, Inc

Risk often occurs without success, but rarely does success occur without risk. In the corporate world, however, risk is often avoided; companies are willing to give up the opportunity for big gains in order to hedge the risk of big losses. During the process of analyzing the opportunities available to Lester Electronics, the executive team took time to review a capital budgeting simulation; this helped prepare the team to incorporate and plan for the risks associated with investment decisions. This paper will discuss the risks involved with the project chosen in the Silicon Arts, Inc. simulation and how those risks relate to Lester Electronics’ current situation.

Investment Decision

Based on the Market Research Reports, expert advice, and estimated cash flows, the option that looked best for Silicon Arts, Inc. (SAI) was to enter the Wireless Communication (W-Comm) market. Further analysis of the opportunity cost of the warehouse and the......

Risk Analysis on Investment Decision

Silicon Arts, Inc (SAI) is a manufacturer of digital imaging integrated Circuits. The circuits are used in digital cameras, DVD players, computers, and other digital equipment. Which were sold in North America, Europe, and South East Asia earning SAI annual sales of $180 million. After a slowdown in 2001, SAI’s research and development departments developed a specialized chip used in mobile phones. This chip has helped SAI to enter 2002 with a strong financial position and growth plan.

“SAI wants to increase market share and keep up with technology, which can be done by either expanding their existing Digital Imaging market share or by entering the wireless communication market.” (UOP, 2005). This paper will help to analysis the risk of the investment decision SAI is trying to decide.

External Investment Strategies

An analysis of the external......

Introduction

An investment strategy is a set of rules, behaviors or procedures, designed to guide an investor's selection of an investment portfolio. Usually the strategy will be designed around the investor's risk-return tradeoff: some investors will prefer to maximize expected returns by investing in risky