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Strategies & Market Trends : How To Write Covered Calls - An Ongoing Real Case Study!

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To: hpeace who wrote (1029)	3/15/1997 12:55:00 PM
From: Rodney Lockhart	of 14162

Steve, Kulicke and Soffa Industries in the world's largest supply of semiconductor manfuacturing equipment (wire and die bonding and wafer dicing equipment). Great products, good management, and growing market share. The semi equip. segment was dead last year. KLIC business started to come back last quarter. Now they are capacity limited. We have good intelligence on the Company. We know the number of wire bonders shipping this quarter and scheduled to ship for through 9/30/97. Two regulars on the KILC thread live in KILC's home town. One is actually Scott Kulicke's neighbor. Scott K. is the CEO and COB. They are in process of a secondary offering of 3 to 3 1/2 million shares. (currently 20 million outstanding). The proceeds go to the Company to retire debt (from 50 Million purchase of American Fine Wire) and for expansion. They own 50% of Flip Chip Technologies which just started up in Phonnix on March 3rd. The facility has 80% of the world wide capacity for contract flip chip wafer bumping. The $0.40 - $0.45 estimates for this quarter look fine. They COULD surprise on the up side by up to 30%. The real kicker is what they are scheduled to ship in the 3rd and 4th quarters. Both quarters should beat the $0.85 for the 4th quarter 1995. Seems like a cover call strategy with strangles around earnings annoucements could be very profitable. What do you think?

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