Jacob,
I agree with most of your "fair value" post.
Many of the semi-equips have been and are overvalued
relative to history and relative to others in the group.
AMAT is certainly one of them. Others off the top of my
head would be: ASYT,ASML,KLAC,PRIA,HELX,TER,CYMI.
Of course, MOST large cap stocks in this market are
overvalued relative to any reasonable valuation analysis.
That has not stopped them from going higher. Even though
I agree with your fair value analysis, most people don't
care and they buy the "big name" companies they have heard
of without regard for what is a reasonable value.
There are still great values out there though,
even in the semi-equip sector.
I suggest you look at COHU, EGLS, KLIC.
All would pass your test for being undervalued with
the assumptions you make in your post and would have a PEG less than 1.
All three came out with earnings recently, and based on those earnings and the new estimates for this year I
give you the following data.
COHU current price $43, 2000 earnings ~ $2.50 to $3.00.
EGLS current price $30, 2000 earnings ~ $2.00.
KLIC current price $53, 2000 earnings ~ $3.00+.
Good hunting, and regards, Eric. |
