Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 332.56

+4.1%

3:59 PM EST

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To: Jacob Snyder who wrote (46503)	5/9/2001 11:13:54 PM
From: advocatedevil	Read Replies (2) of 70976

AMAT analyst commentary: Applied Materials (AMAT) 52.60: Timing is everything. Most analysts that cover the chip-equipment sector agree that capital spending by chipmakers will bottom in the next two quarters. However, the spoils will go to those who best time the movement of the stocks. It's a lot easier to predict the former than the latter. The group has enjoyed a nice run recently mostly as a result of Intel (INTC) not reducing its $7.5 bln capital spending budget during its March quarter conference call. And for AMAT specifically, there have been indications that Samsung, Applied's second-largest equipment customer, is about to resume placing orders after a four-month hiatus. But a Morgan Stanley note this morning highlights some risks for AMAT. Morgan's AprQ revenue and EPS forecasts remain at $1.9 bln and $0.32, but there is a dramatic reduction in EPS for JulQ and OctQ. For fiscal years ending 10/01 and 10/02 EPS estimates are being slashed from $1.40 and $1.15 to $1.05 and $0.90, respectively. With AprQ being kept as-is, those full year reductions are large numbers for just two quarters. This lends credence to some analysts' contention that Intel has already spent a good portion of its capex budget for the year. Similarly, on Texas Instruments' 4/17 conference call, mgmt said it spent half its capex budget in the first quarter, so it's not a leap to say that Intel has already spent much of its 2001 budget. Morgan Stanley retains its "Buy by August" mantra for AMAT and other equipment stocks, but the question is how much of the good news has already been priced into the group. - Robert J. Reid, Briefing.com Link: www2.briefing.com Applied Materials (AMAT) 52.60: Morgan Stanley lowering estimates ahead of company's May 15 earnings report; reduces 2001 est. to $1.05 from $1.40 and 2002 to $0.90 from $1.15 (consensus est. are $1.47 and $1.73). Firm maintains Q2 est. of $0.32, but believes AMAT will struggle to break even in Q3... Maintains Outperform rating and holds to mantra for sector: "Buy by August." Link: www2.briefing.com AdvocateDevil

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