Zonder,
Your email says>>>>>>>
In October, Novellus said it expected orders to come in flat to down 10% for the December quarter. Some of its peers in the equipment sector are bracing for worse, with Lam Research predicting orders will slide around 15%, and Applied Materials guiding for bookings to drop 20%.
"Business levels are flat, with improving profitability due to cost containment," CEO Richard Hill said on its conference call. "Whether you look at the U.S., Asia, Europe or Japan, the overall economic conditions are tentative, and as a result, there are very conservative investment scenarios being played out by our customers."
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I take this last sentence to mean "no increase in demand to be seen". <<<<<<<
From Briefing's update on yesterday's call>>>>>
Novellus thinks bottom probably in place - Update -- In response to analyst question about Q1 (Mar) visibility, CEO said he isn't going to comment on Q1 right now, but he does believe "we are probably at a bottom"... notes that, at these levels, the safe bet is that things stay flat.. - Update -- On mid-qtr update, still expects total revenues to be $211 mln; notes shipments should be $185 mln or slightly higher... -- On mid-qtr update, says net bookings for Q4 (Dec) are now expected to be $200 mln to possibly $210 mln... this is improved from Q3 conference call when it said Q4 bookings would be $200 mln or could be 10% lower<<<<
The Street.com post doesn't clarify that the 10% lower was stated on the Q3 CC, and now at the mid-Q update, the statement is flat to higher.
Also, the CEO is saying "its a safe bet that things stay flat" and "we're probably at a bottom". You can read this two ways (half full or half empty) or as no increase in demand (as you state) and no decrease in demand (which the CC suggests).
Technically, I believe it's overextended and will likely pullback. As I stated yesterday, rangebound between 30-36, well it's already proven me wrong, as it's at 37. Maybe Mr. Market sees a recovery for Semis and never allowed its valuations to drop dirt cheap, like it has for Telecom for example.
I wish you luck with your investment.
Ketan |
