IDTI - an IC Play on Growth Markets Message Board

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Technology Stocks : IDTI - an IC Play on Growth Markets

IDTI 48.99

0.0%

Mar 29 5:00 PM EST

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To: Don Edgerton who wrote (11015)	11/30/2000 12:20:01 PM
From: Rob S.	Read Replies (1) of 11555

That is comparing apples and battleships. Utilities and to some extent pharmaceuticals have a much more predictable revenue base and margins. The chips sector is much more volatile (no joke). Sales and earnings are highly dependent on marginal growth/contraction rates. If unit growth rates just decrease to a modest rate of 10%, the industry can tank. Sales can go down 30% on a slowing to 10% unit growth. That happened a few years ago and will happen again at some point. Some investors obviously fear that it is happening now. Chip companies are saying they don't see it, at least not yet. But the market is so nervous that it is taking problems with consumer PC sales as a predictor of semi industry health. Of course this makes little sense today because so much of sales goes into the communications and instrumentation industries. Very little of IDTI's sales are effected by PC - only indirectly in that fewer PC users, etc. may equate to lower rates of expansion of Internet and communications servers, routers and switches.

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