The Chip Business

Affy('s) metrics

The market likes to use sales and profitability models as yardsticks in determining whether a company is fairly valued. Affymetrix Inc. has one of those measuring tools - sales - and hopes to have the other - profits - in the fourth quarter of 2000.

But analysts have struggled to pinpoint a value for the company, given the inherent difficulties in modeling a company without profits in the relatively new space of microchip-based gene analysis. To compound the problem, although AFFX told BioCentury that it makes 90,000 to 100,000 chips per year, the company does not disclose the number of chips it sells. Therefore, it's not surprising that analyst's valuations are all over the map. In fact, analysts polled by BioCentury put the fair value of the stock at anywhere from $75 to $120.