SRS Labs, Inc. (SRSL)

With ~$3 per share in cash and no debt the P/E and PEG are less helpful indicators than is normally the case. Recalculating them for share price less cash (~$4) gives an effective P/E of 14 and PEG of 0.7. It also suggests a forward effective P/E of 10 based on independent $0.40 '09 earnings estimate. SRSL is still associated with semiconductor sector but a better comp is larger DLB (P/E of 29, PEG of 1.84, and forward P/E of 26 for comparison.) Bulk of SRSL revenue (70%) is associated with licensing surround audio technology used in flat screen TV's/ entertainment systems. It should benefit from 2/09 transition to digital-broadcast-only in the U.S. Go to SRS Labs website (www.srslabs.com) and listen to the "on"-"off" demos (audio demos tab) to hear what the technology really does. They sell downloadable software that will keep your computer sounding as good as the demo. Company buyback would bring in about 10% of shares at current price. Recent entry into the "set-top-box" field (to give old TVs the benefit of digital audio after the 2/09 broadcast transition) suggests the company is nimble enough to take quick advantage of new opportunities. Listen to the conference calls at their "investors" page to understand one-time costs and prospective new contracts.
With $0.40 EPS, a 25 P/E, 10% fewer shares, and $3 in cash this could be a 0.4x25x1.1+3=$14 stock in '09. (Yes, I'm assuming they bring in enough cash to offset that spent on the buyback.)