Story Stocks
clearstation.com.
Updated: 08-Oct-99
Quotes at time of story, top stories today: (Chip Sector: 14:40) (B2B Stocks 13:59) (VIRS 12:23) (BGEN 11:15) (Online Brokerages: 10:45) (HIFN 09:01) (XRX 08:34) (HIFN 19:30)
14:40 ET ******
Chip Sector: The Philadelphia Semiconductor Index, or SOX, is down another 3.3% in today's action bringing its two day loss to 7.3%... Chip stocks getting hammered due to earnings warning from HI/FN (HIFN) 40 1/4 -33 3/4 and declining DRAM prices... DRAM prices fell more than $1, lending credence to reports that demand has dried up... Lingering anxiety over impact on earnings from Taiwan earthquake also weighing on the group... Given that most of the stocks in the sector were trading at, or just off, their 52-wk highs, the bad news came as a shock to many investors... But before you follow the herd and dump your chip stocks consider that we are about to be inundated with Q3 earnings reports from the industry... Take a look at Briefing.com's Earnings Calendar and/or Tech Earnings Calendar and you will see that starting next week the chip sector kicks off earnings season in a big way... Among the companies due to report their results are Intel (INTC), Motorola (MOT), Altera (ALTR), Linear Tech (LLTC) and Dallas Semiconductor (DS)... In the chip equipment group, KLA-Tencor (KLAC), Novellus (NVLS), Cree Research (CREE) and FSI International (FSII) will be stepping to the plate... In other words, the chip and chip equipment makers don't have to wait long to dispel market concerns... Based on soft comparison periods and generally strong industry conditions, quarter three should be a big one for the chip group with most of the companies reporting positive earnings surprises... Based on this fact, we expect the chip sector to stage a very quick and relatively powerful recovery in the days just ahead... Of course a stock like Micron (MU) which is particularly sensitive to DRAM prices might not be the best choice for a recovery play, but as earnings fears give way to earnings excitement companies such as LSI Logic (LSI), Analog Devices (ADI), Broadcom (BRCM), Linear (LLTC), Altera (ALTR), Applied Materials (AMAT) and Novellus (NVLS) are good candidates for solid upside pops. -- RW |
