Cohu, Inc. (COHU) Message Board

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Technology Stocks : Cohu, Inc. (COHU)

COHU 23.00

-1.0%

Dec 17 3:59 PM EST

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To: Mike Redding who wrote (2037)	7/17/2000 8:57:18 AM
From: robert b furman	Read Replies (2) of 7827

OK , you asked for it,and keep in mind you wanted a guess.<smile> I have two preferred scenarios: 1) A secondary runup near new highs - similar to the runup from 28 1/8 (pre -split) to 46-47 in 1998. If this unfolds I would anticipate high volume and a continuation of the distribution that occurred in February- March this year. This could also be a runup right to the very top (62) - similar to what occurred in 1996. Both of these secondary moves ,if accompanied by high volume will be final distribution tops and should provide an excellent short position. A large fear of shorting this great company is the fear of a merger. Cohu is the dominant player in it's niche,but the industry sector is loaded with cash rich 400 pound gorilla's (not to mention the 800 pounder AMAT). 2)The second scenario (which is becoming my most preferred -as the price of Cohu goes lower than I expected),is that of new highs.This becomes more possible if the rise up thru the overhead resistance occurrs on quick price rises AND on lower volume. In otherwords only the nervous nellies who just want there original investment back sell to those strong holders who have just accumulated a position at a lower cost basis.This would form a cup and handle at 62.If a breakout occurred on strong volume at 62 - new highs would result.My swag on valuation ceilings is EPS of 2.75 X's historical high pe of 29 = 79-80.Investor excuberence can drive things higher than they should so an outright overevaluation could bring in 90. How's that for ouigi board dreamin? I think the key is to watch the volume - it will tell us what the institutional holders are doing - they own a lot of Cohu and control the price action. Bob

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