Undervalued Stocks = Low P/E to Growth Ratios Message Board

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Strategies & Market Trends : Undervalued Stocks = Low P/E to Growth Ratios

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To: David A. Stern who wrote (212)	9/30/1997 6:24:00 PM
From: Mason Barge	of 297

Cymer (CYMI) is one stock I know inside out. The Zack's estimate of future growth is not worth very much. Correction, not worth a plug nickel. It's probably reasonably close for the next 2 years, though, as long as DUV photolith is the solution of choice for wafer fabs, i.e. .25um resolution fabs are being built. But when the industry moves even to .18, much less .13 and .10um design rules, nobody has ANY idea of what kind of light source the steppers will be using. I don't like CYMI long-term and it's only so-so short term, although excellent short-term earnings should bring it back a couple of points from its recent trouncing. There is no customer defection at this point. The worry is that supplies of glass (extremely rare "fused silica", very hard to make) will keep the stepper companies (Nikon, Canon, SVGI and ASMLF) who buy Cymer's lasers from building machines fast enough to keep pace with prior growth estimates. At this moment Cymer has a near-monopoly on DUV lasers suitable for commercial cutting-edge chip manufacture. The question is, how many lasers can they sell before the technology moves somewhere else?

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