Rambus (RMBS) Top Pick at Rosenblatt as DDR5 DRAM transition can now 'begin in earnest'

Rosenblatt analyst Kevin Cassidy reiterated a Buy rating and $45.00 price target on Rambus Inc. (NASDAQ: RMBS), saying with Intel's Sapphire Rapids server CPU is finally out, the data center DDR5 DRAM transition can begin in earnest. The stock is a top long idea for 2023. The analyst highlighted:

• Intel's previous generation, 3rd Generation Xeon for servers, addressed up to ~1TB of DDR4 DRAM. The 4th Generation DDR5 addresses up to 1.5TB of DDR5 DRAM. A 50% increase per CPU.
• AMD's Genoa server CPU announced last month, addresses up to 6TB of DDR5 DRAM. The previous generation Milan, supported up to 4TB of DDR4 DRAM. A 50% increase per module.
• Rambus is a provider of Register Clock Drivers (RCD) and data buffers used on server DRAM modules. DDR5 modules have many more features including higher performance vs. DDR4 modules. We estimate that Rambus content per DDR5 module is currently ~ $15 vs. ~$5 for a DDR4 module.
• Rambus was first to market with DDR5 module RCDs which typically drives market share leadership. We expect Rambus to have 50% market share in DDR5 modules vs. ~20% market share in DDR4.
• The DDR5 transition in data centers benefits Rambus in higher dollar content per module, more modules per CPU, increasing market share.

For an analyst ratings summary and ratings history on Rambus Inc. click here. For more ratings news on Rambus Inc. click here.

Shares of Rambus Inc. closed at $37.99 yesterday.

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