Tim, you may be right, the numbers look very good, but they do not look as good as CYMI (relativly). Furthermore I see few points of weakness indicating we have passed the peak and have only few quarters of additional growth, but much smaller growth QOQ. Take for instance the quarterly BTB, it is below the industry's at 1.20 and below AMAT's own peak last quarter (if memory serves, 1.41). The improvement in gross margins from last quarter is nw minute (from 50.1% to 50.9 %) and probably will not exceed 52% for the cycle. Last, their DOS have increased again to 71 days form 69 days, all , IMHO, indications that the peak in the stock has been seen, and YOY comparisions are going to become more difficult going forward. I think that AMAT will give us a possible rally but very muted (I believe that $78/80 will no serve as a strong overhead supply). Now that CSCO and AMAT have reported what else is left in the "earnings" ammunition for the "summer rally". I am of the opinion that we will not go the 4500 level this summer (namely, I changed my "tune" on this) and actually will be stalled right around here under 3950 or so, maybe the turn today was the begining of a test of the low we set last week around 3550 or so. Once this is successfully tested. Accordingly, I am going to be selective, when stock gets beaten irrationally (like SSTI and SNDK in the low $50') I'll step in.
Zeev |
