Cymer (CYMI) Message Board

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Technology Stocks : Cymer (CYMI)

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To: Jerome who wrote (23005)	9/1/1999 11:47:00 PM
From: FJB	Read Replies (1) of 25960

Jerome, Basing Cymer's correct valuation on next quarter's earnings is a unique approach. The problem with this approach is that the vast majority of market participants use methods which discount the earnings(and preferably cash flow) over a much greater period of time. In using a "next quarter's earnings" method of placing a value on the stock you are betting against most of the market, which is using the traditional valuation models. I'm excluding traders in this discussion. For example, using the "next quarter's earnings" method of valuing any stock in the semiconductor or semiconductor equipment sectors would cause you to sell a stock at the bottom and buy at the top. All I am saying is that using the valuation system you have suggested does not work well for this sector in particular and most likely won't work for any stock, because you are betting against the majority and from a trading perspective "the tape". Lastly, Cymer is expected to earn $0.06 in the next quarter which is in the middle range of their guidance. It is extremely unrealistic to throw up numbers like $0.10 and $0.15. Don't get upset because a stock is not behaving as you expected. This has happened to every investor/trader. Bob

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