FWIW....i think i've been saying this too<G>
from Reuters via Quote.com
Topic: (NASDAQ:NVLS) Novellus Systems, Inc., (NYSE:LSI) LSI Logic Corp, (NASDAQ:PMCS) PMC - Sierra, Inc., (NASDAQ:KLAC) KLA-Tencor Corporation, (NASDAQ:ALTR) Altera Corporation, (NASDAQ:KLIC) Kulicke and Soffa Industries, Inc., (INDEX:$SOX.X) Semiconductor Sector Index (PHLX), (NASDAQ:LRCX) Lam Research Corporation, (NASDAQ:XLNX) Xilinx, Inc., (NYSE:TER) Teradyne Inc
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Quote.com News Item #13643610
Headline: Semi shares to benefit once stocks stabilize
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By Barbara Etzel
NEW YORK, April 14 (Reuters) - Shares of semiconductors
companies and equipment makers got caught in Friday's broad
market sell-off, but when the dust clears, investors will
return to the sector, which is seeing solid earnings and record
order levels, analysts said.
The Philadelphia Semiconductor Index (INDEX:$SOX.X) fell nearly 12
percent after it dropped 117.43 points to 892.27. The
technology-ladden Nasdaq stock market, also nosedived nearly 10
percent, or 358.17 points, to 3,318.61.
Blue-chip stocks fared little better, with the Dow Jones
industrial average down over 5 percent, or 623 points, at
10,300.
Particularly hard hit were chip makers Xilinx Inc. (NASDAQ:XLNX)
and LSI Logic Corp. (NYSE:LSI). Shares of Xilinx were down 12-1/2
at 57-3/8. Shares of LSI Logic Corp. (NYSE:LSI) were down 9-15/16
at 49-7/8.
"The market is reassessing technology. I think what we are
going to see is that the whole group comes down and then when
the reset button gets pushed, those technology companies with
real earnings will be the ones with the better values," Bryon
Walker, analyst at Warburg Dillon Read, said.
Chip makers, and the companies that make the equipment they
use, have benefited from strong demand and the prospect of
continued strength as demand for devices providing access to
the Internet and communications devices grows.
That fundamental scenario is helping chip equipment makers
KLA-Tencor Corp. (NASDAQ:KLAC), communications chip maker PMC-Sierra
Inc. (NASDAQ:PMCS) and programmable logic chip maker Altera Corp.
(NASDAQ:ALTR) report strong earnings this week that have exceeded
expectations.
But despite the strong financial results, shares of
KLA-Tencor fell 7-3/8 to 57-3/8. Shares of testing equipment
maker Teradyne Inc. (NYSE:TER), which reports earnings on Tuesday,
were down 8-5/8 at 74-5/8. Both trade on the Nasdaq stock
market.
Next week when equipment makers Lam Research Corp. (NASDAQ:LRCX)
Inc., Teradyne, Novellus Systems Inc. (NASDAQ:NVLS), Kullicke &
Soffa Industries Inc. (NASDAQ:KLIC) and others report earnings, the
same strong picture is expected to emerge.
"Orders are the future of the company and orders will be
very strong across the board," Walker said about next week's
earnings reports.
Brett Hodess, analyst at Banc of America Securities, said
he expects Kulicke & Soffa, which reports earnings on Tuesday,
to surpass his expectation of $198 million in revenues and
earnings per share of 65 cents.
"Not only will they beat that number, but we think that
orders will be quite strong and they will be able to give
guidance for stronger revenues and earnings orders for the
remainder of the year," Hodess said.
Strong fundamentals will ultimately bring investors back to
the semiconductor sector, when they begin to return to the
market, Hodess said.
"As investors become comfortable that maybe this downdraft
is starting to ebb, the first place they should be coming back
to in technology is really semi and semi equipment," said
Hodess.
"The visibility for earnings is incredibly high for the
next several quarters and really for the remainder of the
year," he added.
Michael O'Brien, analyst at Wit SoundView, said that he
expects Teradyne to exceed by a little bit his estimates of
$620 million in revenues and earnings of 53 cents a share.
"I think the semiconductor area is one of the more
attractive area for investors if they want to get back into
technology, "O'Brien said.
859-1860))
Copyright 2000, Reuters News Service
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