Scott,
At the various bottoms of the semi-equips as a group, ie 1996, 1998, 2000, etc, the PE's for the group were quite low. As posted several times previously, the most recent low for the group was on 11/30/00. A synopsis ot the situation can be seen at:
Message 14920902
Note the following statement in the above reference:<gg>
<Maybe we hit the limit today and will turn around tomorrow.>
The next day, Friday, 12/1, the following post reported on the group status.
Message 14928271
The group was up from the Thursday close, but notice the low PEs. The prices for the group were down and the earnings estimates were still quite high. It doesn't show on the chart, but with the group price at 609.22 and the earnings at 57.72, the PE for the group is 10.6. With the group closing Friday with a PE of 36, that is more than 3 times the number on 12/1.
The question is - where do we go from here over the next several months. Is the group going to move "sideways" or upward from here, or will we have another "downside" to deal with in the near future. IMO we are going to have a pullback here of some magnitude prior to a further runup. For a long term "buy and hold" point of view, certainly the group will rise further from here and a pullback from present levels is of little concern. For short term traders however, the right answer to the near term movement is of great importance.
Don:) |
