Donald - in reference to your table in post #120, I return to my favorite topic, 'Klic as canary'. Thus far this year the action of Klic has been a compelling prognosticator for the sector. The most recent earnings warning by and share price decline by Klic suggests the sector has not bottomed yet (although this certainly could be completely WRONG. Anyone who thinks they can predict this sector with any degree of certainty is foolish.).
If I've read your table correctly, Klic is one of only two stocks showing a YOY decline in estimated earnings (and Klic's is by far the worst). In my opinion, this is an anomaly: either the estimates for Klic are unbelievably off on the low side or, and this is likely closer to the case, all of the other estimates haven't caught up (down) with the 'reality' that Klic is seeing. The fact that Klic's revenues are significantly more reactive to the moment-by-moment condition of the sector would also support the latter conclusion.
We've been through the recent experience of Klic being one of the first to acknowledge weakness in the industry. On SI this 'experience' was characterized by a virtual consensus opinion that 'Klic is an isolated case' only to be shown, in very short order, that Klic was not only NOT isolated but it was a true harbinger. The same scenario now applies to the glaring discrepancy between Klic's earnings forecast and that of the rest of the sector. Either Klic will be revised back up to the sector or vice versa.
As we've learned in no uncertain terms during the last 4 months - and even allowing huge wiggle-room for the fickleness of analysts' estimates - to ignore another Klic-anomaly scenario is a risky, head-in-the-sand approach.
I believe the continuing pounding of the sector suggests that we're about to witness significant downward revisions in FY2001 earnings estimates throughout the industry so that, once again, the sector 'catches down' to Klic.
Best regards,
Scott. |
