STOCKREPORTS		 Cirrus Logic, Inc. Nasdaq Symbol CRUS
In S&P MidCap 400
19-JUL-97 Industry:
Electronics (Semiconductors)		 Summary: Cirrus develops proprietary chip solutions for the desktop and portable computing and consumer electronics markets.

Recent Price 12.94
52 Wk Range 24.13 - 8.50		 Yield Nil
12-Mo. P/E NM

Quantitative Evaluation:
Outlook (1 Lowest - 5 Highest)
1-
Fair Value
7.61
Risk
HIGH
Earn/Div Rank
C
Technical Evaluation:
BULLISH since 05/97
Rel. Strength Rank (1 Lowest - 99 Highest)
87
Insider Activity
NA

Overview 05-MAY-97

Revenues in FY 98 (Mar.) are projected to grow in the mid-single digits. FY 98's first-quarter revenues will likely show flat sequential growth with those of the fourth quarter of the prior fiscal year, partly reflecting the delayed ramp of the company's new 3-D graphics product and as customers transition away from its mature 2-D product. However, second-half revenues should begin to show benefits from new product offerings, including the Laguna 3D/AGP chip and new 56K chipsets for modems, which carry higher selling prices. Gross margins should continue to be limited by the aggressive pricing environment in the first half, but improve during the second half, due to product mix and the greater volume expected. Operating expense growth should trail the pace of revenue growth, with costs expected to be culled out due to reorganization efforts. We estimate FY 98 EPS of $0.50.

Valuation 05-MAY-97

We recently downgraded the shares after CRUS reported an unexpected loss for its FY 97 fourth quarter. After reporting profits in the prior two quarters, it appeared that the worst was behind CRUS. The operating loss reflected the company's difficult product cycle transition in graphics. Customers transitioned to competitors' 3-D graphics while Cirrus's product lost initial design wins, hampered by industry delays in ramping accompanying technology. In addition, the business is becoming increasingly commodity-like in nature, dampening selling prices. CRUS is now accelerating its restructuring efforts, including reducing its workforce by 15% and consolidating operations, to improve its focus and cut costs. In the meantime, we remain cautious on the highly volatile shares in light of the competitive landscape and CRUS's reliance on new products for growth, and thus recommend avoiding the shares.

Key Stock Statistics

S&P EPS Est. 1998 0.52
P/E on S&P Est. 1998 24.9
Dividend Rate/Share Nil
Shs. outstg. (M) 66.2
Avg. daily vol. (M) 1.169
Tang. Bk. Value/Share 6.11
Beta 2.03
Shareholders 2,400
Market cap. (B) $0.856
Inst. holdings 21%
Value of $10,000 invested 5 years ago:$ 12,262

Fiscal Year Ending Mar. 31

Revenue (Million $)
1998 1997 1996 1995 1994 1993
Q1 201.6 214.9 300.3 176.0 99.2 67.34
Q2 NA 236.0 317.8 202.2 124.8 83.23
Q3 NA 253.3 295.8 228.6 149.9 99.6
Q4 NA 212.9 233.1 273.2 170.2 104.6
Year NA 917.2 1,147 889.0 544.1 354.8

Earning Per Share ($)
1998 1997 1996 1995 1994 1993
Q1 0.04 -0.12 0.34 0.25 -0.08 0.07
Q2 E0.09 0.05 0.47 0.19 0.13 0.15
Q3 E0.17 0.16 -0.06 0.23 0.37 0.14
Q4 E0.22 -0.79 -1.38 0.29 0.25 0.05
Year E0.52 -0.71 -0.58 0.96 0.70 0.40

Dividend Data: No cash dividends have been paid.

Business Summary 05-MAY-97

Cirrus Logic is a leading producer of advanced integrated circuits for the desktop and portable computing and consumer electronics markets. It applies analog, digital and mixed-signal design capabilities and software and system-level engineering expertise to create differentiated products for customers.

CRUS offers a broad family of multimedia products providing graphics, video and audio functions for desktop and portable PCs. Graphics products include a line of graphics and integrated graphics/video accelerators. Video solutions include liquid crystal display (LCD) graphics controllers and LCD panel driver chips. Through its Crystal Semiconductor subsidiary, the company offers a wide array of audio products that bring CD-quality audio and studio-quality composition and mixing quality to PCs and workstations.

CRUS supplies chips that perform the key electronic functions contained in advanced disk drives. A broad family of disk-drive controller products for the mass storage market is sold to customers such as Fujitsu, Hewlett-Packard, Quantum, Seagate and Sony.

In early 1997 and late 1996, CRUS sold its wireless communications businesses. Products included cellular digital packet data (CDPD), which allows packets of digital data to be transmitted over existing Advanced Mobile Phone Service analog cellular networks, and chipsets for the PHS digital cordless phone market.

Wireline products include fax/data/voice modem chipsets and input/output (I/O) devices that allow multichannel, multiprotocol communications. Cirrus began volume production of its new 56-kilobits-per-second modem chipset in March 1997.

In September 1994, CRUS formed MiCRUS, a joint venture with IBM, to manufacture semiconductor wafers for both companies. In October 1995, a similar joint venture was formed with Lucent Technologies. The company also has agreements with outside manufacturers to make its wafers.

Important Developments

Jan. '97 CRUS completed the sale of the Wireless Semiconductor Products group to Rockwell International for $18.1 million cash. The businesses sold provided digital cordless chip solutions for PHS and DECT (Digital European Cordless Telecommunications) technologies, as well as two-way messaging chip solutions for pACT (personal Air Communications Technology). In November, the company sold its CDPD and other base-station equipment businesses to ADC Telecommunications for $23 million in cash.
Dec. '96 CRUS placed privately $300 million of 6% subordinated notes, convertible into common at $24.22 a share.

Capitalization

Long Term Obligs.: $366,292,000 (3/97).

Per Share Data ($)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Tangible Bk. Val. 6.11 6.70 6.92 5.96 2.97 2.62 2.42 1.76 1.11 NA
Cash Flow 0.64 0.45 1.51 1.20 0.70 0.63 0.75 0.64 NA NA
Earnings -0.71 -0.58 0.96 0.70 0.40 0.41 0.59 0.51 0.16 -0.34
Dividends Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil
Payout Ratio Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil
Cal. Yrs. 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987
Prices - High 27 1/4 61 1/8 22 3/8 20 18 1/2 12 1/4 10 3/4 7 7/8 NA NA
- Low 12 5/8 11 1/8 10 1/2 6 5/8 8 6 1/8 4 4 1/2 NA NA
P/E Ratio - High NM NM 23 29 46 30 18 15 NA NA
- Low NM NM 11 10 20 15 7 9 NA NA

Income Statement Analysis (Million $)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Revs. 917 1,147 889 544 355 172 142 85.0 37.0 9.0
Oper. Inc. 48.8 32.8 119 66.0 49.8 32.0 31.7 19.9 6.7 -6.7
Depr. 87.9 64.3 34.3 26.9 15.2 8.4 5.1 3.8 2.3 1.7
Int. Exp. 19.7 5.2 2.4 2.2 1.6 0.8 1.0 0.7 0.6 0.6
Pretax Inc. -51.6 -41.7 89.6 54.8 32.9 23.0 29.1 18.0 4.3 -8.4
Eff. Tax Rate NM NM 32% 32% 37% 32% 35% 15% 6.00% Nil
Net Inc. -46.1 -36.1 61.4 37.1 20.6 15.6 18.8 15.4 4.1 -8.4

Balance Sheet & Other Fin. Data (Million $)
1997 1996 1995 1994 1993 1992 1991 1990 1989 1988
Cash 340 175 187 237 72.7 48.3 54.9 40.8 6.7 4.9
Curr. Assets 795 595 480 413 194 99 91.0 67.0 15.0 10.0
Total Assets 1,137 918 674 502 256 141 109 78.0 21.0 15.0
Curr. Liab. 366 412 228 145 95.8 32.9 25.9 21.7 6.4 4.8
LT Debt 366 76.7 26.2 19.1 18.1 11.9 9.3 3.1 2.3 2.1
Common Eqty. 404 429 419 338 143 96.0 74.0 52.0 12.0 8.0
Total Cap. 770 506 445 357 161 107 83.0 55.0 14.0 10.0
Cap. Exp. 30.7 128 47.3 34.9 26.7 5.5 10.9 7.3 0.9 0.4
Cash Flow 41.8 28.1 95.7 63.9 35.7 24.0 23.9 19.2 NA NA

Curr. Ratio 2.2 1.4 2.1 2.8 2.0 3.0 3.5 3.1 2.4 2.1
% LT Debt of Cap. 47.5 15.1 5.9 5.4 11.3 11.1 11.2 5.6 15.9 21.1
% Net Inc.of Revs. NM NM 6.9 6.8 5.8 9.1 13.3 18.6 11.0 NM
% Ret. on Assets NM NM 10.1 9.2 9.4 11.5 20.0 31.2 22.3 NM
% Ret. on Equity NM NM 15.7 14.7 16.0 17.0 30.0 48.0 41.0 NM

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--3100 W. Warren Ave., Fremont, CA 94538. Tel--(510) 623-8300. Website--http://www.cirrus.com Chrmn & Exec VP--S. S. Patil. Pres & CEO--M. L. Hackworth. VP-Fin & CFO--T. F. Kelly. Investor Contact--Mark Singer. Dirs--C. G. Bell, D. J. Guzy, M. L. Hackworth, D. L. Lyon, S. S. Patil, C. W. Rea Jr., W. C. Rhines, R. H. Smith. Transfer Agent & Registrar--First National Bank of Boston. Incorporated--in California in 1984. Empl-- 3,151. S&P Analyst: Megan Graham Hackett


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