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Technology Stocks : KEMET Corp.
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To: Rarebird who wrote (495)8/10/2000 11:23:59 AM
From: Jack Hartmann  Read Replies (1) of 906
 
This is why I'm asking questions about how this will affect revenue growth, EPS and margins?

Additional capacity will mean more revenue and earnings as present capacity is at its peak. KEM is not taking any new customers on due tocapacity constraints. In order to to increase revenues without expansion means further price increase to suppliers. I think KEM wants to maintain good relationships with dependable bookings. Whether margins will hold is another issue. The fear in the component sector is that PC amkers and wireless will slow down order and affect KEM, AVX, and VSH. That could happen and the companies would have under utilized capacity. I watch the backlog and it hasn't shown any sign of slowing yet. Also the three companies are not in a cutthroat bidding war for customers. Just the opposite is true. Predicting when the cycle does end will be hard to predict. The price now offers less downside to upside so I'm invested in it.
Jack
Jack
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