The standard by which all video game software companies are judged. These guys have created juggernaut after juggernaut of video game franchises, led first and foremost by their remarkably fun and always current Madden franchise. The stock has gone nowhere for the last couple years of the 2G cycle and as PS3 et al have been pushed out repeatedly, ERTS has had its fair sure of fundamental problems. But this will be a cash generating machine into the next couple years and analyst estimates are way too low at $1.34 for the March 08 fiscal year.

I ask readers – when was the last time this company had any good fundamental news? They just recalled 8 trillion laptop batteries because 7 of them blew up when some idiot left his laptop running in his computer bag for two hours. Okay, I’m exaggerating, but the fact is that you want to buy a stock when it’s hated right in front of a new cycle. Just when everybody’s given up on it.

I think it’s time I face the truth; the DoJ, the IRS and especially the SEC are going to completely fail in their mission of protecting investors and prosecuting white-collar criminals when it comes to this options backdating travesty. Broadcom’s management team misled investors about some $1.5 billion in earnings power over the last few years, but apparently they are indeed going to get away with it. Meanwhile, the company’s really hitting their stride from a fundamental perspective aside from some lingering inventory build up issues in their channels. But from Ethernet transceivers that go into every Xbox 360 to the WiFi, Bluetooth and sensor components in every Wii box, Broadcom’s gonna sell a lot of very high margin chips into the 3GVG cycle.

Another company, like Broadcom, which lied to investors about the earnings power of the company for years. And like Broadcom, they’re going to get away with it. However, also like Broadcom, Marvell’s got at least three chips going into every single PS3, and they’re going to ride the Sony coattails higher during the 3GVG cycle.

I cited AMD last month as a great way to play the Vista cycle. And the company’s also going to benefit from the Xbox 360 cycle, as their recent acquisition of ATI makes them the second most important graphics processor company behind Nvidia. AMD’s management has been flamed for this acquisition, as they’re currently actually buying more from Nvidia as ATI’s new graphics chips are a bit behind schedule. Also, Wall Street’s “what have you done for me lately” approach to tech stocks gives the opportunity to get into a great company at a cheap price. To read more about The Cody Report go to TheCodyReport.net.