RE "1. down cycles last about 12 months. That would mean it would be prudent to wait till (very approximately) April
2001 to get back in."
Yes, but the strange thing is, this cycle, the price
cycle ended about 7 months ago but the fundamental
semi cycle has not ended. Bookings have continued to
rise. While stock prices can lead fundamentals by a
year, I don't think anyones outlook 5 months from now
(plus the 7 months we're down = 1 year) expects things
to be bad enough to justify the current prices of many
companies in the sector such as KLIC, COHU, EGLS, ASYT,
LRCX, etc. Obviously, the huge premium that AMAT carries
puts it in a more vulnerable category.
Looks like everyone has to have their two year semi cycles.
This semi cycle, we may get two stock price cycles within
one fundamental cycle. One can argue that fundamentals
are (or could be) somewhat weaker for the sector, but this
is nothing like the REAL fundamental down cycle of late
1998 or 1996.
On a price to "reality" scale, we are lower than the 1998
lows for many companies in the sector (AMAT not included). |
